Income for TreeHouse Foods down 32% in year

by Staff
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WESTCHESTER, ILL. — Net income at TreeHouse Foods, Inc. fell 32% in fiscal 2008.

For the year ended Dec. 31, 2008, income was $28,224,000, equal to 90c per share on the common stock, compared with $41,622,000, or $1.33 per share, during the previous year. Sales for the quarter were $1,500,650,000, up 30% from $1,157,902,000 during the previous year.

Two items affecting reporting results during the year were an intercompany loan with the company’s E.D. Smith subsidiary to reflect current currency rates and an interest rate adjustment. The company also experienced costs associated with the closing of the Portland, Ore., pickle plant and costs associated with unfavorable factory variances from the third-quarter inventory reduction program.

"The past year was the most challenging the packaged foods industry has faced in decades, yet we overcame the extreme inflation and volatility of input costs through targeted pricing actions and internal cost controls," said Sam K. Reed, chairman and chief executive officer. "We generated top-line growth in key product categories, including soup, salsa, salad dressing and non-dairy creamer and also expanded distribution of our E.D. Smith and San Antonio Farms acquisitions. Despite these challenges, we exceeded our original expectations and outperformed the food industry."

Income for the fourth quarter was $6,791,000, or 22c per share, down 52% from $14,278,000, or 46c per share, during the same quarter of the previous year. Sales for the quarter were $398,082,000, up 7% from $370,936,000 during the same quarter of the previous year.

For 2009, the company said it expects earnings to increase 11% to 14% to $1.80 to $1.85 per share before one-time items and considering potential acquisitions. The company also is anticipating an increase of 1% in sales revenue. For the first quarter, the company is expecting earnings per share to be in the range of 35c to 37c.

"Over the past year, we have demonstrated our ability to succeed under the most adverse food industry conditions," Mr. Reed said. "We expect external cost pressures to subside in 2009, thus allowing us to focus on real growth, expanded distribution and productivity gains in the new year."

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