Document and Entity Information
Document and Entity Information (USD $) | |||
12 Months Ended
May. 02, 2010 | Jun. 24, 2010
| Oct. 30, 2009
| |
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | 2010-05-02 | ||
Document Fiscal Year Focus | 2,010 | ||
Document Fiscal Period Focus | FY | ||
Trading Symbol | DLM | ||
Entity Registrant Name | DEL MONTE FOODS CO | ||
Entity Central Index Key | 0000866873 | ||
Current Fiscal Year End Date | --05-02 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Common Stock, Shares Outstanding | 199,731,660 | ||
Entity Public Float | $2,130,261,228 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS (USD $) | ||
In Millions | May. 02, 2010
| May. 03, 2009
|
ASSETS | ||
Cash and cash equivalents | 53.7 | 142.7 |
Trade accounts receivable, net of allowance | 187 | 188.5 |
Inventories | 726.4 | 677.4 |
Prepaid expenses and other current assets | 128.5 | 138.6 |
TOTAL CURRENT ASSETS | 1095.6 | 1147.2 |
Property, plant and equipment, net | 658.8 | 642.6 |
Goodwill | 1337.7 | 1337.7 |
Intangible assets, net | 1162.4 | 1171.5 |
Other assets, net | 34.4 | 22.3 |
TOTAL ASSETS | 4288.9 | 4321.3 |
LIABILITIES AND STOCKHOLDERS' EQUITY | ||
Accounts payable and accrued expenses | 469.5 | 472.4 |
Short-term borrowings | 5.6 | 2.3 |
Current portion of long-term debt | 30 | 32.3 |
TOTAL CURRENT LIABILITIES | 505.1 | 507 |
Long-term debt | 1255.2 | 1525.9 |
Deferred tax liabilities | 441 | 390.5 |
Other non-current liabilities | 260.2 | 291.4 |
TOTAL LIABILITIES | 2461.5 | 2714.8 |
Stockholders' equity: | ||
Common stock ($0.01 par value per share, shares authorized: 500.0; 216.6 issued and 199.2 outstanding at May 2, 2010 and 215.1 issued and 197.7 outstanding at May 3, 2009) | 2.2 | 2.1 |
Additional paid-in capital | 1,085 | 1047.5 |
Treasury stock, at cost | -183.1 | -183.1 |
Accumulated other comprehensive income (loss) | -59.8 | -38.4 |
Retained earnings | 983.1 | 778.4 |
TOTAL STOCKHOLDERS' EQUITY | 1827.4 | 1606.5 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | 4288.9 | 4321.3 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) | ||
Share data in Millions, except Per Share data | May. 02, 2010
| May. 03, 2009
|
Common stock, par value | 0.01 | 0.01 |
Common stock, shares authorized | 500 | 500 |
Common stock, issued | 216.6 | 215.1 |
Common stock, outstanding | 199.2 | 197.7 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME (USD $) | |||
In Millions, except Per Share data | 12 Months Ended
May. 02, 2010 | 12 Months Ended
May. 03, 2009 | 12 Months Ended
Apr. 27, 2008 |
Net sales | 3739.8 | 3626.9 | 3179.8 |
Cost of products sold | 2510.6 | 2622.7 | 2319.9 |
Gross profit | 1229.2 | 1004.2 | 859.9 |
Selling, general and administrative expense | 721.2 | 643.3 | 541.4 |
Operating income | 508 | 360.9 | 318.5 |
Interest expense | 116.3 | 110.3 | 131.4 |
Other (income) expense | 9.8 | 24.1 | -2.5 |
Income from continuing operations before income taxes | 381.9 | 226.5 | 189.6 |
Provision for income taxes | 139.9 | 78.8 | 71.9 |
Income from continuing operations | 242 | 147.7 | 117.7 |
Income from discontinued operations before income taxes | 1.4 | 38.9 | 11.4 |
Provision (benefit) for income taxes | -0.9 | 14.3 | (4) |
Income from discontinued operations | 2.3 | 24.6 | 15.4 |
Net income | 244.3 | 172.3 | 133.1 |
Basic earnings per common share: | |||
Continuing Operations | 1.22 | 0.74 | 0.58 |
Discontinued Operations | 0.01 | 0.13 | 0.08 |
Total | 1.23 | 0.87 | 0.66 |
Diluted earnings per common share: | |||
Continuing Operations | 1.19 | 0.74 | 0.58 |
Discontinued Operations | 0.01 | 0.13 | 0.08 |
Total | 1.2 | 0.87 | 0.66 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY AND COMPREHENSIVE INCOME (USD $) | ||||||
In Millions | Common Stock
| Treasury Stock
| Additional Paid-in Capital
| Accumulated Other Comprehensive Income (Loss)
| Retained Earnings
| Total
|
Beginning Balance at Apr. 29, 2007 | 2.1 | -133.1 | 1021.7 | 24.4 | 537.1 | 1452.2 |
Beginning Balance (in shares) at Apr. 29, 2007 | 202.2 | 12 | ||||
Net income | 133.1 | 133.1 | ||||
Other comprehensive income/(loss): | ||||||
Gain (Loss) on cash flow hedging instruments (net of tax of $14.5 in 2010, $9.5 in 2009 and $3.5 in 2008) | -5.5 | -5.5 | ||||
Currency translation adjustment | 1.6 | 1.6 | ||||
Pension liability adjustment (net of tax of $25.6 in 2010, $19.6 in 2009 and $8.00 in 2008) | -12.3 | -12.3 | ||||
Comprehensive income | 116.9 | |||||
Issuance of shares (in shares) | 0.5 | |||||
Issuance of shares | 3.8 | 3.8 | ||||
Repurchase of shares (in shares) | -5.4 | 5.4 | ||||
Repurchase of shares | (50) | (50) | ||||
Dividends declared ($0.20 per share in 2010 and $0.16 per share in 2009 and 2008) | -31.9 | -31.9 | ||||
Tax benefit from stock options exercised | 0.2 | 0.2 | ||||
Adoption of new income tax guidance | 0.3 | 0.3 | ||||
Stock option expense | 8.8 | 8.8 | ||||
Restricted stock units and amortization of unearned compensation | 0.2 | 0.2 | ||||
Ending Balance (in shares) at Apr. 27, 2008 | 197.3 | 17.4 | ||||
Ending Balance at Apr. 27, 2008 | 2.1 | -183.1 | 1034.7 | 8.2 | 638.6 | 1500.5 |
Net income | 172.3 | 172.3 | ||||
Other comprehensive income/(loss): | ||||||
Gain (Loss) on cash flow hedging instruments (net of tax of $14.5 in 2010, $9.5 in 2009 and $3.5 in 2008) | -14.7 | -14.7 | ||||
Currency translation adjustment | -1.5 | -1.5 | ||||
Pension liability adjustment (net of tax of $25.6 in 2010, $19.6 in 2009 and $8.00 in 2008) | -30.4 | -30.4 | ||||
Comprehensive income | 125.7 | |||||
Issuance of shares (in shares) | 0.4 | |||||
Issuance of shares | 2.1 | 2.1 | ||||
Dividends declared ($0.20 per share in 2010 and $0.16 per share in 2009 and 2008) | -31.6 | -31.6 | ||||
Adoption of new benefit plan guidance (net of tax of $0.5) | -0.9 | -0.9 | ||||
Stock option expense | 8.9 | 8.9 | ||||
Restricted stock units and amortization of unearned compensation | 1.8 | 1.8 | ||||
Ending Balance (in shares) at May. 03, 2009 | 197.7 | 17.4 | ||||
Ending Balance at May. 03, 2009 | 2.1 | -183.1 | 1047.5 | -38.4 | 778.4 | 1606.5 |
Net income | 244.3 | 244.3 | ||||
Other comprehensive income/(loss): | ||||||
Gain (Loss) on cash flow hedging instruments (net of tax of $14.5 in 2010, $9.5 in 2009 and $3.5 in 2008) | 23.7 | 23.7 | ||||
Currency translation adjustment | -5.4 | -5.4 | ||||
Pension liability adjustment (net of tax of $25.6 in 2010, $19.6 in 2009 and $8.00 in 2008) | -39.7 | -39.7 | ||||
Comprehensive income | 222.9 | |||||
Issuance of shares (in shares) | 1.5 | |||||
Issuance of shares | 0.1 | 12.2 | 12.3 | |||
Dividends declared ($0.20 per share in 2010 and $0.16 per share in 2009 and 2008) | -39.6 | -39.6 | ||||
Tax benefit from stock options exercised | 1.7 | 1.7 | ||||
Stock option expense | 9.9 | 9.9 | ||||
Restricted stock units and amortization of unearned compensation | 13.7 | 13.7 | ||||
Ending Balance (in shares) at May. 02, 2010 | 199.2 | 17.4 | ||||
Ending Balance at May. 02, 2010 | 2.2 | -183.1 | $1,085 | -59.8 | 983.1 | 1827.4 |
1_CONSOLIDATED STATEMENTS OF ST
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY AND COMPREHENSIVE INCOME (Parenthetical) (USD $) | |||
In Millions, except Per Share data | 12 Months Ended
May. 02, 2010 | 12 Months Ended
May. 03, 2009 | 12 Months Ended
Apr. 27, 2008 |
Gain (Loss) on cash flow hedging instruments, tax | 14.5 | 9.5 | 3.5 |
Pension liability adjustment, tax | 25.6 | 19.6 | 8 |
Dividends declared, per share | 0.2 | 0.16 | 0.16 |
Adoption of new benefit plan guidance, tax | 0.5 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | |||
In Millions | 12 Months Ended
May. 02, 2010 | 12 Months Ended
May. 03, 2009 | 12 Months Ended
Apr. 27, 2008 |
OPERATING ACTIVITIES: | |||
Net income | 244.3 | 172.3 | 133.1 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | 99.4 | 104.9 | 106.2 |
Deferred taxes | 54.4 | 29.5 | 44.1 |
Write off of debt issuance cost and loss on debt refinancing | 24.8 | ||
(Gain)/loss on asset disposal | 2.6 | -23.3 | -7.5 |
Stock compensation expense | 21.3 | 12.2 | 9 |
Discontinuation of hedge accounting for interest rate swap | 13.4 | ||
Tax benefit from stock options exercised | 0.1 | ||
Impairment loss on pet intangible assets | 3 | 11.7 | |
Other non-cash items, net | -3.5 | 10.1 | -6.5 |
Changes in operating assets and liabilities: | |||
Trade accounts receivable, net | -2.4 | 89.5 | -26.7 |
Inventories | -51.9 | -78.5 | -6.2 |
Prepaid expenses and other current assets | 19.7 | -58.9 | 20.7 |
Other assets, net | -0.5 | 2.5 | 4.5 |
Accounts payable and accrued expenses | (38) | -69.5 | 7.4 |
Other non-current liabilities | -30.7 | -1.9 | 8.7 |
NET CASH PROVIDED BY OPERATING ACTIVITIES | 355.9 | 200.6 | 286.9 |
INVESTING ACTIVITIES: | |||
Capital expenditures | -104.9 | -88.7 | -96.7 |
Net proceeds from disposal of assets | 365.8 | 17.5 | |
Other items, net | -0.5 | ||
NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES | -104.9 | 277.1 | -79.7 |
FINANCING ACTIVITIES: | |||
Proceeds from short-term borrowings | 208.8 | 517.7 | 543.6 |
Payments on short-term borrowings | -204.3 | -515.7 | -565.1 |
Proceeds from long-term debt | 1042.2 | ||
Principal payments on long-term debt | -1315.7 | -333.8 | -89.4 |
Payments of debt related costs | -43.6 | -5.3 | |
Dividends paid | -37.6 | -31.6 | -32.2 |
Issuance of common stock | 12.3 | 2.1 | 3.8 |
Purchase of treasury stock | (50) | ||
Excess tax benefits from stock-based compensation | 1.7 | 0.1 | |
NET CASH USED IN FINANCING ACTIVITIES | -336.2 | -361.3 | -194.5 |
Effect of exchange rate changes on cash and cash equivalents | -3.8 | 0.6 | |
NET CHANGE IN CASH AND CASH EQUIVALENTS | (89) | 117 | 12.7 |
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR | 142.7 | 25.7 | 13 |
CASH AND CASH EQUIVALENTS AT END OF YEAR | 53.7 | 142.7 | 25.7 |
Business and Basis of Presentat
Business and Basis of Presentation | |
12 Months Ended
May. 02, 2010 | |
Business and Basis of Presentation | Note1.Business and Basis of Presentation Del Monte Foods Company and its consolidated subsidiaries (Del Monte or the Company) is one of the countrys largest producers, distributors and marketers of premium quality, branded pet products and food products for the U.S. retail market, generating $3.7 billion in net sales in fiscal 2010. The Companys leading pet food and pet snacks brands include Meow Mix, Kibbles n Bits, Milk-Bone, 9 Lives, Pup-Peroni, Gravy Train, Natures Recipe and Canine Carry-Outs and other brand names, and food brands include Del Monte, Contadina, SW, College Inn and other brand names. The Company also produces and distributes private label pet products and food products. The majority of its products are sold nationwide in all channels serving retail markets, mass merchandisers, the U.S. military, certain export markets, the foodservice industry and food processors. Del Monte Corporation (DMC) is a direct, wholly-owned subsidiary of Del Monte Foods Company (DMFC). DMC and DMCs subsidiaries accounted for 100% of the consolidated revenues and net earnings of DMFC, except for expenses relating to compensation of the members of the Board of Directors of the Company. As of May2, 2010, DMFCs assets relate solely to its investment in DMC. DMFC had no subsidiaries other than DMC and DMCs subsidiaries, and had no direct liabilities other than accruals relating to the compensation of the directors of the Board of Del Monte Foods Company. DMFC is separately liable under various full and unconditional guarantees of indebtedness of DMC, including under full and unconditional guarantees of DMCs 71/2%Senior Subordinated Notes due 2019 and DMCs 63/4% Senior Subordinated Notes due 2015. DMC and DMCs subsidiaries are subject to limitations on their ability to make loans, advances, dividends and distributions to DMFC under the indentures governing DMCs senior subordinated notes and DMCs senior credit facility. For a description of DMCs senior credit facility and senior subordinated notes, see Note 7. On April24, 2006, pursuant to an Asset Purchase Agreement between DMC and TreeHouse Foods, Inc. (TreeHouse), DMC sold to TreeHouse certain real estate, equipment, machinery, inventory, raw materials, intellectual property and other assets that were primarily related to the Companys (1)private label soup business, (2)infant feeding business conducted under the brand name Natures Goodness, and (3)the food service soup business (collectively, the Soup and Infant Feeding Businesses). On May19, 2006, DMC completed the acquisition of Meow Mix Holdings, Inc. (Meow Mix), the maker of Meow Mix brand cat food and Alley Cat brand cat food. The financial results of Meow Mix are reported within the Pet Products reportable segment. Effective July2, 2006, DMC completed the acquisition of certain pet product assets, including the Milk-Bone brand (Milk-Bone), from Kraft Foods Global, Inc. The financial results of Milk-Bone are reported within the Pet Products reportable segment. On October6, 2008, pursuant to the Purchase Agreement dated June29, 2008 among DMC, Dongwon Enterprise Co., Ltd. (Dongwon Enterprise), Dongwon Industries Co., Ltd. (Dongwon |
Significant Accounting Policies
Significant Accounting Policies | |
12 Months Ended
May. 02, 2010 | |
Significant Accounting Policies | Note2.Significant Accounting Policies Trade Promotions: Accruals for trade promotions are recorded primarily at the time a product is sold to the customer based on expected levels of performance. Settlement of these liabilities typically occurs in subsequent periods primarily through an authorized process for deductions taken by a customer from amounts otherwise due to the Company. Deductions are offset against related trade promotion accruals. The original estimated costs of trade promotions are reasonably likely to change in the future. Evaluations of the trade promotion liability are performed monthly and adjustments are made where appropriate to reflect changes in the Companys estimates. Trade promotion expense is recorded as a reduction to net sales. Retirement Benefits: The Company sponsors a qualified defined benefit pension plan (during the third quarter of fiscal 2010, the Company merged its three qualified defined benefit pension plans into a single plan) and several unfunded defined benefit postretirement plans, providing certain medical, dental and life insurance and other benefits to eligible retired, salaried, non-union hourly and union employees. Under the direction of the Company, independent third-party actuaries utilize statistical and other factors to anticipate future events in calculating an estimate of the expense and liabilities related to these plans. The actuarial reports are used by the Company in estimating the expenses and liabilities related to these plans. The factors utilized by the Companys actuaries include assumptions about the discount rate, expected return on plan assets, the health care cost trend rate, withdrawal and mortality rates and the rate of increase in compensation levels. These assumptions may differ materially from actual results due to changing market and economic conditions, higher or lower withdrawal rates or longer or shorter mortality of participants. These differences may impact the amount of retirement benefit expense recorded by the Company in future periods. The funded status of the Companys pension and other postretirement plans is recorded as a liability, and all unrecognized gains or losses, net of tax, are recorded as a component of accumulated other comprehensive income (loss) (AOCI) within stockholders equity. Goodwill and Intangibles with Indefinite Lives: The Company does not amortize goodwill and intangible assets with indefinite lives, but instead tests for impairment at least annually. Additional impairment tests may be performed between annual tests if circumstances indicate that a potential impairment exists. The Company has designated the first day of the fourth fiscal quarter as the annual impairment testing date, at which time the Company engages third party valuation experts to assist in its valuation of its intangible assets with indefinite lives and reporting units that have goodwill assigned to them. When conducting the annual impairment test for goodwill, the Company compares the estimated fair value of a reporting unit containing goodwill to its book value. The estimated fair value is computed using two approaches: the income approach, which is the pres |
Discontinued Operations
Discontinued Operations | |
12 Months Ended
May. 02, 2010 | |
Discontinued Operations | Note3.Discontinued Operations As described in Note 1, on October6, 2008 Del Monte completed the divestiture of the StarKist Seafood Business. As a result of the sale, the Company recognized a gain of $42.6 million, included in income from discontinued operations, and taxes of $12.8 million included in provision for income taxes from discontinued operations. At the time of sale, Del Monte entered into a two-year Operating Services Agreement (scheduled to be completed in September 2010) pursuant to which the Company currently provides operational services to Starkist Co. such as warehousing, distribution, transportation, sales, information technology and administration. Del Monte has concluded that the continuing cash flows related to the Operating Services Agreement are not direct cash flows because such cash flows are not significant to the StarKist Seafood Business; accordingly, the operating results of the StarKist Seafood Business are appropriately reported as discontinued operations. Star-Kist Samoa, Inc., which merged with and into Acquisition Sub in connection with the sale of the StarKist Seafood Business as described in Note 1, was party to a 10-year supply agreement with Tri-Marine International, Inc. (Tri-Marine) to purchase annual quantities of raw tuna from various vessels owned by or contracted to Tri-Marine. Total purchases by the Company under this agreement were approximately $72.8 million and $73.7 million for fiscal 2009 (for the period prior to the sale) and fiscal 2008, respectively. Additionally, in connection with the sale of the StarKist Seafood Business, DMC entered into a Bifurcation and Partial Assignment and Assumption Agreement with Impress Group, B.V. (Impress) and Starkist Co. to bifurcate and assign to Starkist Co. specified rights and obligations under the Amended and Restated Supply Agreement between Impress and Del Monte Corporation dated as of January23, 2008 (the Supply Agreement). Total purchases by the Company under the bifurcated and assigned portion of the Supply Agreement (including under its predecessor agreement) were approximately $22.7 million and $39.6 million for fiscal 2009 (for the period prior to the sale) and fiscal 2008, respectively. Net sales from discontinued operations were $2.0 million, $283.9 million and $557.6 million for fiscal 2010, fiscal 2009 and fiscal 2008, respectively. Net sales from discontinued operations for fiscal 2010 are primarily related to changes in estimates as the Company performs the wind-down of the StarKist Seafood Business. The following table sets forth the components of basic and diluted earnings per common share for discontinued operations for fiscal 2009: FiscalYear 2009 Basic diluted earnings per common share Gain on sale of the StarKist Seafood Business $ 0.15 Loss from the StarKist Seafood Business (0.02 ) Income from discontinued operations $ 0.13 Income from discontinued operations for fiscal 2010, fiscal 2009 and fiscal 2008 includes approximately $0.0 million, $1.5 million and $10.0 million, respectively, of depreciation expense. In October 2008, the Company applied |
Supplemental Financial Statemen
Supplemental Financial Statement Information | |
12 Months Ended
May. 02, 2010 | |
Supplemental Financial Statement Information | Note4.Supplemental Financial Statement Information May2, 2010 May3, 2009 (in millions) Trade accounts receivable: Trade $ 187.3 $ 188.7 Allowance for doubtful accounts (0.3 ) (0.2 ) TRADE ACCOUNTS RECEIVABLE, NET $ 187.0 $ 188.5 Inventories: Finished products $ 616.8 $ 552.0 Raw materials and in-process material 43.5 45.2 Packaging material and other 108.3 112.6 LIFO Reserve (42.2 ) (32.4 ) TOTAL INVENTORIES $ 726.4 $ 677.4 Prepaid expenses and other current assets: Prepaid expenses $ 85.0 $ 80.3 Other current assets 43.5 58.3 PREPAID EXPENSES AND OTHER CURRENT ASSETS $ 128.5 $ 138.6 Property, plant and equipment: Land and land improvements $ 33.9 $ 30.2 Buildings and leasehold improvements 304.7 296.5 Machinery and equipment 784.4 729.6 Computers and software 112.9 100.1 Construction in progress 50.9 46.2 1,286.8 1,202.6 Accumulated depreciation (628.0 ) (560.0 ) PROPERTY, PLANT AND EQUIPMENT, NET $ 658.8 $ 642.6 Accounts payable and accrued expenses: Accounts payabletrade $ 172.1 $ 184.0 Marketing and advertising 84.2 75.5 Accrued payroll and related costs 57.3 52.2 Accrued interest 5.6 18.7 Income tax payable 0.5 4.9 Current portion of pension liability 44.5 41.6 Other current liabilities 105.3 95.5 ACCOUNTS PAYABLE AND ACCRUED EXPENSES $ 469.5 $ 472.4 Other non-current liabilities: Accrued postretirement benefits $ 137.3 $ 109.5 Pension liability 38.1 77.9 Other non-current liabilities 84.8 104.0 OTHER NON-CURRENT LIABILITIES $ 260.2 $ 291.4 Fiscal Year 2010 2009 2008 (in millions) Allowance for doubtful accounts rollforward: Allowance for doubtful accounts at beginning of year $ (0.2 ) $ (0.1 ) $ (0.3 ) Additions: charged to costs and expenses (0.1 ) (0.1 ) (0.2 ) Deductions: write-offs or reversals 0.4 Allowance for doubtful accounts at end of year $ (0.3 ) $ (0.2 ) $ (0.1 ) |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | |
12 Months Ended
May. 02, 2010 | |
Goodwill and Intangible Assets | Note5.Goodwill and Intangible Assets The following table presents the Companys goodwill and intangible assets: May2, May3, 2010 2009 (in millions) Goodwill $ 1,337.7 $ 1,337.7 Non-amortizable intangible assets: Trademarks $ 1,060.5 $ 1,071.6 Amortizable intangible assets: Trademarks 40.7 32.6 Customer relationships 89.0 89.0 Other 11.0 11.0 140.7 132.6 Accumulated amortization (38.8 ) (32.7 ) Amortizable intangible assets, net 101.9 99.9 Intangible assets, net $ 1,162.4 $ 1,171.5 During the second quarter of fiscal 2010, the Company recognized an impairment charge of $3.0 million related to one of its Pet Products non-amortizable intangible assets and moved this brand from non-amortizable intangible assets to amortizable intangible assets. This impairment charge is included in selling, general and administrative expense in the Consolidated Statements of Income for the year ended May2, 2010. During the fourth quarter of fiscal 2009, management decided to discontinue five non-core pet brands and accordingly the related unamortized balances of the trademark intangible assets were impaired. The Company recorded an impairment charge of $11.7 million related to the impaired intangible assets which is included in selling, general and administrative expense in the Consolidated Statements of Income for the year ended May3, 2009. As of May2, 2010 and May3, 2009, the Companys goodwill was comprised of $1,187.5 million related to the Pet Products reportable segment and $150.2 million related to the Consumer Products reportable segment. Amortization expense for fiscal 2010, fiscal 2009 and fiscal 2008 was $6.1 million, $7.8 million and $7.9 million, respectively. The following table presents expected amortization of intangible assets as of May2, 2010, for each of the five succeeding fiscal years (in millions): 2011 $ 7.2 2012 7.2 2013 5.8 2014 4.5 2015 4.5 |
Earnings Per Share
Earnings Per Share | |
12 Months Ended
May. 02, 2010 | |
Earnings Per Share | Note6.Earnings Per Share The following table sets forth the computation of basic and diluted earnings per share for continuing operations: Fiscal Year 2010 2009 2008 (in millions, except per share data) Basic earnings per common share: Numerator: Net income from continuing operations $ 242.0 $ 147.7 $ 117.7 Denominator: Weighted average shares 199.0 198.1 200.6 Basic earnings per common share $ 1.22 $ 0.74 $ 0.58 Diluted earnings per common share: Numerator: Net income from continuing operations $ 242.0 $ 147.7 $ 117.7 Denominator: Weighted average shares 199.0 198.1 200.6 Effect of dilutive securities 3.8 0.3 2.2 Weighted average shares and equivalents 202.8 198.4 202.8 Diluted earnings per common share $ 1.19 $ 0.74 $ 0.58 The computation of diluted earnings per share calculates the effect of dilutive securities on weighted average shares. Dilutive securities include stock options, restricted stock units, and other deferred stock awards. Stock options and restricted shares outstanding in the amounts of 2.3million, 16.9million and 10.9million were not included in the computation of diluted earnings per share for fiscal 2010, fiscal 2009 andfiscal 2008, respectively, because inclusion of these options and restricted shares would be antidilutive. |
Short-Term Borrowings and Long-
Short-Term Borrowings and Long-Term Debt | |
12 Months Ended
May. 02, 2010 | |
Short-Term Borrowings and Long-Term Debt | Note7.Short-Term Borrowings and Long-Term Debt The Companys debt consists of the following, as of the dates indicated: May2, 2010 May3, 2009 (in millions) Short-term borrowings: Revolver $ $ Other 5.6 2.3 $ 5.6 $ 2.3 Long-term debt: Term A Loan $ 592.5 $ 218.5 Term B Loan 639.7 Total Term Loans 592.5 858.2 85/8 % senior subordinated notes 450.0 63/4 % senior subordinated notes 250.0 250.0 71/2 % senior subordinated notes 450.0 1,292.5 1,558.2 Less unamortized discount on the 71/2% senior subordinated notes (1) 7.3 Less current portion 30.0 32.3 $ 1,255.2 $ 1,525.9 (1) Amortization on the debt discount was $0.5 million for the year ended May2, 2010. Senior Credit Facility On January29, 2010, the Company entered into a new five-year senior secured credit agreement with Bank of America, N.A., as administrative agent, and the other lender and agent parties thereto (with all related loan documents, and as amended from time to time, the Senior Credit Facility), replacing the Companys prior credit agreement dated February8, 2005 (with all related loan documents, and as amended from time to time, the Prior Credit Facility). All commitments under the Prior Credit Facility were terminated and all outstanding borrowings thereunder were repaid effective January29, 2010. The remaining obligations of DMC and DMFC under the Prior Credit Facility generally are limited to certain remaining contingent indemnification obligations under such facility. The Prior Credit Facility consisted of a revolving credit facility which was scheduled to mature on February8, 2011, a term A loan facility which was scheduled to mature on February8, 2011, and a term B loan facility which was scheduled to mature on February8, 2012. The revolving credit facility included a letter of credit subfacility of $100.0 million. The interest rate spread for the revolving credit facility and the term A loan was adjusted periodically based on the total debt ratio and was a maximum of 1.50% over the Eurodollar rate or 0.50% over the base rate. The interest rate spread for the term B loan was fixed at 1.50% over the Eurodollar rate or 0.50% over the base rate. To maintain availability of funds under the revolving credit facility, the Company paid a 0.375% commitment fee on the unused portion of the revolving credit facility. The Senior Credit Facility consists of a $500.0 million five-year revolving credit facility (the Revolver) and a $600.0 million five-year term A loan facility (the Term A Facility). The Senior Credit Facility also provides that, under certain conditions, the Company may increase the aggregate principal amount of loans outstanding thereunder by up to $500.0 million, subject to receipt of additional lending commitments for such loans. The Revolver includes a letter of credit subfacility of $150.0 million. On January29, 2010, the Company borrowed $50.0 million un |
Derivative Financial Instrument
Derivative Financial Instruments | |
12 Months Ended
May. 02, 2010 | |
Derivative Financial Instruments | Note8.Derivative Financial Instruments The Company uses interest rate swaps, commodity swaps, futures, option and swaption (an option on a swap) contracts as well as forward foreign currency contracts to hedge market risks relating to possible adverse changes in interest rates, commodity, transportation and other prices and foreign currency exchange rates, which (to the extent effective) affect interest expense on the Companys floating-rate obligations as well as the cost of its raw materials and other inputs, respectively. Interest Rates: The Companys debt primarily consists of floating rate term loans and fixed rate notes. The Company also uses its floating rate Revolver to fund seasonal working capital needs and other uses of cash. Interest expense on the Companys floating rate debt is typically calculated based on a fixed spread over a reference rate, such as LIBOR (also known as the Eurodollar rate). Therefore, fluctuations in market interest rates will cause interest expense increases or decreases on a given amount of floating rate debt. The Company from time to time manages a portion of its interest rate risk related to floating rate debt by entering into interest rate swaps in which the Company receives floating rate payments and makes fixed rate payments. On September6, 2007, the Company entered into an interest rate swap, with a notional amount of $400.0 million, as the fixed rate payer. The swap had an effective date of October26, 2007 and a maturity date of October29, 2010. A formal cash flow hedge accounting relationship was established between the swap and a portion of the Companys interest payment on floating rate debt. Swaps are recorded as an asset or liability in the Companys consolidated balance sheet at fair value, with an offset to AOCI to the extent the hedge is effective. Derivative gains and losses included in OCI are reclassified into earnings as the underlying transaction occurs. Any ineffectiveness gains and losses are recorded as an adjustment to other (income) expense. As discussed in Note 7, on January29, 2010 the Company entered into the Senior Credit Facility which replaces the Companys Prior Credit Facility. In conjunction with the repayment of the Prior Credit Facility, the interest rate swap was deemed ineffective due to the repayment of the underlying hedged liability. Accordingly, during the fiscal year ended May2, 2010, the $13.4 million loss associated with the swap being deemed ineffective was reclassified from OCI into earnings and is included in other (income) expense in the Consolidated Statements of Income. The interest rate cash flow hedges had an impact of $12.5 million on interest expense for fiscal 2010. On April27, 2010 the Company terminated its interest rate swap and made a final payment to the counterparty of $13.4 million. In fiscal 2009, the Companys interest rate cash flow hedge resulted in a $4.5 million decrease to OCI and a $2.9 million increase to deferred tax assets. The interest rate cash flow hedge had an impact of $9.1 million on interest expense for fiscal 2009. The fair value of the Companys interest rate swap was recorded as a non-current liability of $21.1 millio |
Fair Value Measurements
Fair Value Measurements | |
12 Months Ended
May. 02, 2010 | |
Fair Value Measurements | Note 9.Fair Value Measurements In September 2006, the FASB issued a statement addressing fair value measurements. This statement defines fair value, establishes a framework for measuring fair value in accordance with generally accepted accounting principles, and expands disclosures about fair value measurements. The fair value provisions are effective for fiscal years beginning after November15, 2007. In February 2008, the FASB issued a staff position which delayed the effective date of the fair value provisions by one year for nonfinancial assets and liabilities that are recognized or disclosed at fair value in the financial statements on a nonrecurring basis. In the first quarter of fiscal 2009, the Company adopted the fair value provisions for financial assets and liabilities. This adoption did not have a material impact on the Companys consolidated financial statements. The Company adopted the fair value provisions for nonfinancial assets and liabilities in the first quarter of fiscal 2010. As of May2, 2010, the Company did not have any significant nonfinancial assets or liabilities measured at fair value subsequent to their initial recognition. A three-tier fair value hierarchy is used to prioritize the inputs used in measuring fair value. The hierarchy gives the highest priority to quoted prices in active markets (Level 1) and the lowest priority to unobservable inputs (Level 3). The three levels are defined as follows: Level 1 Inputsunadjusted quoted prices in active markets for identical assets or liabilities; Level 2 Inputsquoted prices for similar assets and liabilities in active markets or inputs that are observable for the asset or liability, either directly or indirectly through market corroboration, for substantially the full term of the financial instrument; and Level 3 Inputsunobservable inputs reflecting the Companys own assumptions in measuring the asset or liability at fair value. The Company uses commodity contracts, interest rate swaps and forward foreign currency contracts to hedge market risks relating to possible adverse changes in commodity prices, diesel fuel prices, interest rates and foreign exchange rates. The following table provides the fair values hierarchy for financial assets and liabilities measured on a recurring basis: Fair Value Level 1 Level 2 Level 3 Description May2, 2010 May3, 2009 May2, 2010 May3, 2009 May2, 2010 May3, 2009 (in millions) Assets Commodity Contracts $ 3.5 $ 1.9 $ 7.6 $ $ $ Foreign Currency Contracts 4.5 0.6 Total $ 3.5 $ 1.9 $ 12.1 $ 0.6 $ $ Liabilities Commodity Contracts $ 2.2 $ 17.0 $ 0.3 $ $ $ Foreign Currency Contracts 0.5 1.0 Interest Rate Swap 21.1 Total $ 2.2 $ 17.0 $ 0.8 $ 22.1 $ $ T |
Stock Plans
Stock Plans | |
12 Months Ended
May. 02, 2010 | |
Stock Plans | Note10.Stock Plans On August4, 1997, the Company adopted the Del Monte Foods Company Non-Employee Director and Independent Contractor 1997 Stock Incentive Plan (amended on November4, 1997,October14, 1999 and August24, 2000) (the 1997 Non-Employee Plan). Under the 1997 Non-Employee Plan, grants of non-qualified stock options were able to be made to certain non-employee directors and independent contractors of the Company. The term of any option may not be more than ten years from the date of its grant and options generally vested over a four-year period. As of May2, 2010, an eligible non-employee director held options to purchase 22,500 shares of common stock under this plan. No additional shares are available to be granted under the 1997 Non-Employee Plan. The Del Monte Foods Company 1998 Stock Incentive Plan (the 1998 Plan) was initially adopted by the Board of Directors (the Board) on April24, 1998, modified by the Board on September23, 1998 and approved by the then stockholders on October28, 1998. Under the 1998 Plan, grants of incentive and nonqualified stock options (Options), stock appreciation rights (SARs) and stock bonuses were able to be made to certain employees, non-employee directors and consultants of Del Monte. The term of any Option or SAR may not be more than ten years from the date of its grant. Options generally vested over four or five years. As of May2, 2010, eligible employees held options to purchase 1,146,464 shares of common stock under the 1998 Plan. No additional shares are available to be granted under the 1998 Plan. The Del Monte Foods Company 2002 Stock Incentive Plan (the 2002 Plan) was adopted by the Board on October11, 2002 and approved by the stockholders on December19, 2002, effective December20, 2002. On August15, 2005, the Board approved the amendment and restatement of the 2002 Plan, subject to stockholder approval. On September29, 2005, the stockholders approved the amendment and restatement of the 2002 Plan. On August3, 2007, the Board adopted the Del Monte Foods Company 2002 Stock Incentive Plan, as amended and restated effective August6, 2007, subject to stockholder approval. On September27, 2007, the stockholders approved the amendment and restatement of the 2002 Plan. On July28, 2009, the Board adopted the Del Monte Foods Company 2002 Stock Incentive Plan, as amended and restated effective July28, 2009, subject to stockholder approval (the Amended 2002 Plan). The Amended 2002 Plan was approved by the Companys stockholders at its annual meeting held on September24, 2009. Under the Amended 2002 Plan, the total number of shares authorized for grant was increased by 11,419,645 shares to 42,978,385 shares. The Amended 2002 Plan allows for grants of incentive and nonqualified stock options, stock appreciation rights, stock bonuses and other stock-based compensation, including performance units or shares (together with Options, SARs and stock bonuses, Stock-based Incentive Awards). The 2002 Plan also allows cash awards. The term of any Option or SAR may not be more than ten years from the date of its grant. Subject to certain limitations, the Compensation Committee of the Board has authority to gr |
Retirement Benefits
Retirement Benefits | |
12 Months Ended
May. 02, 2010 | |
Retirement Benefits | Note11.Retirement Benefits Defined Benefit Plans. Del Monte sponsors a qualified defined benefit pension plan (during the third quarter of fiscal 2010, the Company merged its three qualified defined benefit pension plans into a single plan) and several unfunded defined benefit postretirement plans providing certain medical, dental and life insurance benefits to eligible retired, salaried, non-union hourly and union employees. The details of such plans, including discontinued operations, are as follows: Pension Benefits Other Benefits May2, 2010 May3, 2009 May2, 2010 May3, 2009 (in millions) Change in benefit obligation: Benefit obligation at beginning of year $ 359.4 $ 389.7 $ 115.8 $ 123.7 Service cost 10.9 13.2 1.6 2.7 Interest cost 26.7 27.2 8.5 8.3 Actuarial (gain)/loss 75.6 (35.5 ) 21.6 (14.1 ) Net transfer out for business divestiture (0.9 ) Benefits paid (31.2 ) (34.5 ) (3.5 ) (3.9 ) Curtailment gain (0.7 ) Plan amendment 0.4 Benefit obligation at end of year $ 441.8 $ 359.4 $ 144.0 $ 115.8 Accumulated benefit obligation $ 423.8 $ 347.8 Change in plan assets: Fair value of plan assets at beginning of year $ 268.2 $ 343.5 $ $ Actual gain/(loss) on plan assets 66.1 (67.1 ) Employer contributions 96.7 26.3 3.5 3.9 Benefits paid (31.2 ) (34.5 ) (3.5 ) (3.9 ) Fair value of plan assets at end of year $ 399.8 $ 268.2 $ $ Funded status at end of year $ (42.0 ) $ (91.2 ) $ (144.0 ) $ (115.8 ) Amounts recognized in the Consolidated Balance Sheets consist of: Accounts payable and accrued expenses $ (40.0 ) $ (36.7 ) $ (6.7 ) $ (6.3 ) Other non-current liabilities (2.0 ) (54.5 ) (137.3 ) (109.5 ) Total $ (42.0 ) $ (91.2 ) $ (144.0 ) $ (115.8 ) Amounts recognized in accumulated other comprehensive income/(loss) consist of: Actuarial net gain/(loss) $ (77.3 ) $ (49.2 ) $ (8.8 ) $ 13.0 Net prior service credit/(cost) (6.8 ) (7.2 ) 13.6 22.0 Total $ (84.1 ) $ (56.4 ) $ 4.8 $ 35.0 The components of net periodic pension cost for the qualified defined benefit pension plan and other benefit plans for fiscal 2010, fiscal 2009 and fiscal 2008 are as follows: Pension Benefits Other Benefits Fiscal Year Fiscal Year 20 |
Other
Other (Income) Expense | |
12 Months Ended
May. 02, 2010 | |
Other (Income) Expense | Note 12.Other (Income) Expense The components of other (income) expense are as follows: Fiscal Year 2010 2009 2008 (in millions) (Gain) loss on hedging contracts $ (3.7 ) $ 18.9 $ (3.5 ) Foreign currency transaction (gains) losses (0.3 ) 3.9 0.5 Discontinuation of hedge accounting for interest rate swap 13.4 Other 0.4 1.3 0.5 Other (income) expense $ 9.8 $ 24.1 $ (2.5 ) |
Provision for Income Taxes
Provision for Income Taxes | |
12 Months Ended
May. 02, 2010 | |
Provision for Income Taxes | Note13.Provision for Income Taxes The provision for income taxes from continuing operations consists of the following: Fiscal Year 2010 2009 2008 (in millions) Income from continuing operations before income taxes: U.S. federal and U.S. possessions $ 373.3 $ 219.7 $ 174.3 Foreign 8.6 6.8 15.3 $ 381.9 $ 226.5 $ 189.6 Income tax provision (benefit): Current: U.S. federal and U.S. possessions $ 70.8 $ 37.2 $ 18.3 State and foreign 14.7 12.6 8.5 Total current 85.5 49.8 26.8 Deferred: U.S. federal and U.S. possessions 52.1 33.4 40.4 State and foreign 2.3 (4.4 ) 4.7 Total deferred 54.4 29.0 45.1 $ 139.9 $ 78.8 $ 71.9 The above amounts do not include a tax benefit of $1.7 million and $0.2 million for fiscal 2010 and fiscal 2008, respectively, and a tax expense of $0.1 million in fiscal 2009 from the exercise of stock options, which for accounting purposes are recorded in additional paid-in capital. Significant components of the Companys deferred tax assets and liabilities are as follows: May2, 2010 May3, 2009 (in millions) Deferred tax assets: Post employment benefits $ 56.4 $ 45.4 Pension liability 31.8 39.8 Workers compensation 13.9 13.8 Net operating loss and tax credit carry forwards 2.6 12.2 Stock-based compensation 23.4 16.1 Other 36.7 29.2 Gross deferred tax assets 164.8 156.5 Valuation allowance (1.5 ) (2.5 ) Net deferred tax assets 163.3 154.0 Deferred tax liabilities: Depreciation and amortization 95.5 94.9 Intangible assets 466.4 431.9 Inventory 34.7 30.6 Other 5.7 (9.5 ) Gross deferred tax liabilities 602.3 547.9 Net deferred tax liability $ (439.0 ) $ (393.9 ) At May2, 2010, the Company had a valuation allowance for Mexican Asset Tax credit carryforwards of $1.5 million as the utilization of such foreign credits cannot be reasonably assured. The net change in valuation allowance for the year ended May2, 2010 was a decrease of $1.0 million. The Company recognizes a benefit for those deferred tax assets that it believes will more likely than not be realized in the future. The differences between the expected provision for income taxes and the actual provision for income taxes computed at the statutory U.S. federal income tax rate for continuing operations is explained as follows: Fiscal Year 2010 2009 2008 (in millions) Expected income taxes computed at the statutory U.S. federal income tax rate |
Commitments and Contingencies
Commitments and Contingencies | |
12 Months Ended
May. 02, 2010 | |
Commitments and Contingencies | Note14.Commitments and Contingencies As part of its ongoing operations, the Company enters into arrangements that obligate it to make future payments to various parties. Some of these contractual and other cash obligations are not reflected on the balance sheet due to their nature. Such obligations include operating leases, grower commitments and purchase commitments. Lease Commitments. The Company leases certain property, equipment and office and plant facilities. At May2, 2010, the aggregate minimum rental payments required under non-cancelable operating leases were as follows (in millions): 2011 $ 50.6 2012 45.2 2013 36.8 2014 30.6 2015 28.1 Thereafter 99.3 Rent expense related to operating leases was comprised of the following: Fiscal Year 2010 2009 2008 (in millions) Minimum rentals $ 53.3 $ 49.9 $ 49.0 Contingent rentals 20.2 20.2 19.7 $ 73.5 $ 70.1 $ 68.7 Supply Agreements. The Company has long-term supply agreements with two suppliers covering the purchase of metal cans and ends. The agreement with Impress was amended and restated January23, 2008, and as described in Note 3, this agreement was bifurcated in connection with the sale of the StarKist Seafood Business in October 2008. Currently, this agreement grants Impress the exclusive right, subject to certain specified exceptions, to supply metal cans and ends for pet products. The agreement includes certain minimum volume purchase requirements and guarantees a certain minimum financial return to Impress until August13, 2010. Total expenditures for cans and ends for pet food products under this agreement, were $87.1 million, $96.1 million and $96.6 million in fiscal 2010, fiscal 2009 and fiscal 2008, respectively. The minimum commitment under this agreement for fiscal 2011 is approximately $19.1 million. The Impress agreement expires December31, 2015. The agreement with Silgan Containers Corporation (Silgan) is a supply agreement for metal cans and ends used for fruit, vegetable and tomato products. Under the agreement and subject to certain specified exceptions, the Company must purchase all of its requirements for fruit, vegetable and tomato products metal food and beverage containers in the United States from Silgan. Total purchases made under this agreement, which expires December31, 2011, were $230.9 million, $249.9 million and $201.6 million in fiscal 2010, fiscal 2009 and fiscal 2008, respectively. As of May2, 2010, the Company has committed to make purchases of approximately $40.6 million in fiscal 2011. Pricing under the Impress agreement and Silgan agreement is adjusted up to twice a year to reflect changes in metal costs and annually to reflect changes in the costs of manufacturing. Grower Commitments. The Company has entered into non-cancelable agreements with growers, with terms ranging from one year to ten years, to purchase certain quantities of raw products, including fruit, vegetables and tomatoes. Total purchases under these agreements were $197.8 million, $178.3 million and $1 |
Segment Information
Segment Information | |
12 Months Ended
May. 02, 2010 | |
Segment Information | Note15.Segment Information The Company has the following reportable segments: The Pet Products reportable segment includes the Pet Products operating segment, which manufactures, markets and sells branded and private label dry and wet pet food and pet snacks. The Consumer Products reportable segment includes the Consumer Products operating segment, which manufactures markets and sells branded and private label shelf-stable products, including fruit, vegetable, tomato, and broth products. The Companys chief operating decision-maker, its Chief Executive Officer, reviews financial information presented on a consolidated basis accompanied by disaggregated information on net sales and operating income, by operating segment, for purposes of making decisions about resources to be allocated and assessing financial performance. The chief operating decision-maker reviews assets of the Company on a consolidated basis only. The accounting policies of the individual operating segments are the same as those of the Company. The following table presents financial information about the Companys reportable segments: Fiscal Year 2010 2009 2008 (in millions) Net Sales: Pet Products $ 1,750.0 $ 1,673.4 $ 1,431.5 Consumer Products 1,989.8 1,953.5 1,748.3 Total Company $ 3,739.8 $ 3,626.9 $ 3,179.8 Operating Income: Pet Products $ 355.5 $ 219.9 $ 231.2 Consumer Products 222.6 195.1 158.9 Corporate (a) (70.1 ) (54.1 ) (71.6 ) Total Operating Income 508.0 360.9 318.5 Reconciliation to income from continuing operations before income taxes: Interest expense 116.3 110.3 131.4 Other (income) expense 9.8 24.1 (2.5 ) Income from continuing operations before income taxes $ 381.9 $ 226.5 $ 189.6 (a) Corporate represents expenses not directly attributable to reportable segments. For fiscal 2010, 2009 and 2008, Corporate includes $0.0 million, $0.0 million and $21.2 million of transformation-related expenses, respectively, including all severance-related restructuring costs associated with the transformation plan. See Note 5 for goodwill detailed by reportable segment. Geographic Information The following table presents domestic and foreign sales: Fiscal Year 2010 2009 2008 (in millions, except percentages) Net salesUnited States $ 3,514.2 $ 3,420.0 $ 2,997.9 Net salesforeign 225.6 206.9 181.9 Total net sales $ 3,739.8 $ 3,626.9 $ 3,179.8 Percentage of sales: United States 94.0 % 94.3 % 94.3 % Foreign 6.0 % 5.7 % 5.7 % The following table presents domestic and foreign long-lived assets: Fisc |
Quarterly Results of Operations
Quarterly Results of Operations (unaudited) | |
12 Months Ended
May. 02, 2010 | |
Quarterly Results of Operations (unaudited) | Note16.Quarterly Results of Operations (unaudited) First(2) Second Third Fourth (in millions, except per share data) Fiscal 2010 Net sales $ 813.7 $ 958.9 $ 1,013.2 $ 954.0 Operating income 120.9 140.6 138.4 108.1 Net income 58.6 62.6 59.4 63.7 Per share data (1): Basic earnings per share $ 0.30 $ 0.31 $ 0.30 $ 0.32 Diluted earnings per share $ 0.29 $ 0.31 $ 0.29 $ 0.31 Fiscal 2009 Net sales $ 726.2 $ 901.0 $ 942.3 $ 1,057.4 Operating income 13.3 79.5 133.5 134.6 Net income (loss) (10.1 ) 50.4 60.5 71.5 Per share data (1): Basic earnings (loss) per share $ (0.05 ) $ 0.25 $ 0.30 $ 0.36 Diluted earnings (loss) per share $ (0.05 ) $ 0.25 $ 0.30 $ 0.36 (1) Earnings per share were computed independently for each of the periods presented; therefore, the sum of the earnings per share amounts for the quarters may not equal the total for the year. (2) The Companys net sales have exhibited seasonality, with the first fiscal quarter typically having the lowest net sales. Lower levels of promotional activity, the availability of fresh produce, the timing of price increases and other factors have historically affected net sales in the first quarter. |
Share Repurchases
Share Repurchases | |
12 Months Ended
May. 02, 2010 | |
Share Repurchases | Note17.Share Repurchases On June10, 2010, the Company announced that its Board had authorized the repurchase of up to $350.0 million of the Companys common stock over the next 36 months. Under this authorization, repurchases of the Companys common stock may be made from time to time through a variety of methods, including accelerated stock buybacks, open market purchases, privately negotiated transactions, and block transactions. The new authorization supersedes and replaces the Companys previous $200.0 million share repurchase authorization that was scheduled to expire in September 2010, as described below. On June 23, 2010, the Company announced that it had entered into an accelerated stock buyback agreement (ASB) with Goldman, Sachs Co. (Goldman Sachs). Under the ASB, the Company paid Goldman Sachs $100 million and received approximately 6.2 million shares of common stock, which represents a substantial majority of the shares expected to be delivered to the Company under the ASB. Final settlement of this agreement is expected to occur in September 2010, although under certain circumstances specified in the ASB, the completion date may be accelerated or extended. At final settlement, the Company may be entitled to receive additional shares of common stock from Goldman Sachs or, under certain circumstances specified in the ASB, the Company may be required to deliver shares or make a cash payment (at the Companys option) to Goldman Sachs. The repurchased shares will be held in treasury. On September27, 2007, the Board authorized the repurchase of up to $200.0 million of the Companys common stock over 36 months. Under this authorization, as of May2, 2010 and May3, 2009, Del Monte had repurchased 5,370,930 shares of its common stock for a total cash outlay of $50.0 million at an average price of $9.31 per share. |
Financial Information for Subsi
Financial Information for Subsidiary Issuer and Non-Guarantor Subsidiaries | |
12 Months Ended
May. 02, 2010 | |
Financial Information for Subsidiary Issuer and Non-Guarantor Subsidiaries | Note18.Financial Information for Subsidiary Issuer and Non-Guarantor Subsidiaries As discussed in Note 7, in October 2009 DMC issued the 71/2% Notes (such 71/2% Notes, collectively with the 63/4% Notes issued in February 2005, the Notes). The Notes are fully and unconditionally guaranteed on a subordinated basis by DMFC as set forth in the indentures governing the Notes. DMC, the issuer, is 100% owned by DMFC. The Companys credit agreement and indentures generally limit the ability of DMC to make cash payments to DMFC, its parent company, which limits Del Montes ability to pay cash dividends. Presented below are Condensed Consolidating Balance Sheets as of May2, 2010 and May3, 2009; Condensed Consolidating Statements of Income for the years ended May2, 2010,May3, 2009 and April27, 2008 and Condensed Consolidating Statements of Cash Flows for the years ended May2, 2010,May3, 2009 and April27, 2008 of Del Monte Foods Company (Parent Company), Del Monte Corporation (Issuer), and all of Del Monte Corporations subsidiaries, which are not guarantors (Subsidiary Non-guarantors): CONDENSED CONSOLIDATING BALANCE SHEET May2, 2010 (in millions) Parent Company Issuer Subsidiary Non-guarantors Consolidating Entries Consolidated Total ASSETS Current assets: Cash and cash equivalents $ $ 44.6 $ 9.1 $ $ 53.7 Trade accounts receivable, net of allowance 170.7 16.3 187.0 Inventories 696.1 30.3 726.4 Prepaid expenses and other current assets 10.1 155.9 58.5 (96.0 ) 128.5 TOTAL CURRENT ASSETS 10.1 1,067.3 114.2 (96.0 ) 1,095.6 Property, plant and equipment, net 589.8 69.0 658.8 Goodwill 1,336.5 1.2 1,337.7 Intangible assets, net 1,162.4 1,162.4 Other assets, net 1,827.4 103.6 2.1 (1,898.7 ) 34.4 TOTAL ASSETS $ 1,837.5 $ 4,259.6 $ 186.5 $ (1,994.7 ) $ 4,288.9 LIABILITIES AND STOCKHOLDERS EQUITY Current liabilities: Accounts payable and accrued expenses $ 10.1 $ 446.1 $ 109.3 $ (96.0 ) $ 469.5 Short-term borrowings 5.6 5.6 Current portion of long-term debt 30.0 30.0 TOTAL CURRENT LIABILITIES 10.1 476.1 114.9 (96.0 ) 505.1 Long-term debt 1,255.2 1,255.2 Deferred tax liabilities 442.1 (1.1 ) 441.0 Other non-current liabilities 258.6 1.6 260.2 TOTAL LIABILITIES 10.1 2,432.0 116.5 (97.1 ) |