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Seneca Foods reports net earnings for fiscal nine months ended December 31, 2016

Published 25 January 2017

Seneca Foods reported net earnings for the fiscal nine months ended December 31, 2016 of $14.3 million, or $1.43 per diluted share, compared to net earnings of$40.6 million, or $4.04 per diluted share for the same period in the prior year.

A significant portion of the earnings decrease is attributable to the Company recording a gain of $24.3 million related to the contractual payment received in conjunction with a relationship transfer agreement with General Mills in the prior year. In the nine months ended December 31, 2016, net sales increased $7.9 million, or 0.8% to $979.6 million.

The increase is attributable to a sales volume increase of $68.4 million partially offset by unfavorable sales mix and lower selling prices of $60.5 million. The Company reported for the third quarter of 2017, net earnings of $8.2 million, or $0.82 per diluted share, compared to net earnings of $31.1 million, or $3.10 per diluted share, in the fiscal third quarter of 2016. Net sales for the third quarter ended December 31, 2016 decreased from the third quarter ended December 26, 2015 by 14.5%, or $62.5 million to $369.7 million.

The decrease is attributable to a sales volume decrease of $48.5 million and an unfavorable sales mix and lower selling prices of $14.0 million. The sales decrease is mostly a timing difference attributable to a change in contract terms for Green Giant. During the first nine months of fiscal 2017, the Company recorded a restructuring charge of $2.8 million primarily related to severance and the cost of moving equipment from a plant that was closed in the prior fiscal year. In addition, during the first nine months of fiscal 2017, the Company incurred a non-cash after-tax LIFO charge of $0.3 million, compared to a non-cash after-tax LIFO credit of $8.6 million in the first nine months of fiscal 2016. 

Operating income, as reported, was $13.9 million for the quarter ended December 31, 2016 and $48.5 million for the quarter ended December 26, 2015. During the nine months ended December 31, 2016 and the nine months ended December 26, 2015, this was $26.7 million and $66.4 million, respectively. Operating income, excluding the LIFO charge/credit and the restructuring charge/credit, was $11.3 million for the quarter ended December 31, 2016 and $46.4 million for the quarter ended December 26, 2015. During the nine months ended December 31, 2016 and the nine months ended December 26, 2015, this was $29.9 million and $62.8 million, respectively



Source: Company Press Release