TreeHouse Foods earnings, sales climb in fiscal 2010

by Eric Schroeder
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WESTCHESTER, ILL. — Earnings and sales at TreeHouse Foods, Inc. rose 12% and 20%, respectively, during fiscal 2010 in a year company executives described as “outstanding.”

Net income in the year ended Dec. 31, 2010, totaled $90,919,000, equal to $2.59 per share on the common stock, up from $81,314,000, or $2.54 per share, in fiscal 2009. Net sales during fiscal 2010 were $1,817,024,000, up from $1,511,653,000.

During the fourth quarter ended Dec. 31, 2010, net income was $28,081,000, or 79c per share, up 27% from $22,093,000, or 68c per share, in the same period a year ago. Net sales totaled $509,463,000, up 26% from $404,787,000.

“We had an outstanding year, highlighted by the strategic acquisitions of Sturm Foods and S.T. Specialty Foods, as well as solid core operating performance from our legacy businesses,” said Sam K. Reed, chairman and chief executive officer. “Our fourth-quarter results surpassed our expectations, and we are eager to build on this momentum in 2011. Our new information system went live successfully on Feb. 1, thanks to the hard work of our implementation teams. We are already seeing the benefits of the work our teams put in on process improvements and data consistency.”

The acquisition of Sturm Foods, a manufacturer of hot cereals and beverage mixes, and S.T. Specialty Foods, a maker of private label macaroni and cheese, skillet dinners and other value-added side dishes and salads, had a positive impact on TreeHouse Foods’ North American Retail Grocery business unit, which saw its sales increase 28% to $1,247,126,000 during fiscal 2010. Operating income rose 45% to $221,473,000.

Looking ahead to fiscal 2011, TreeHouse was optimistic on the continued growth prospects of its private label products. The company expects private label sales in 2011 to grow approximately 12% to 13% from 2010 due to a full year of sales from the acquired businesses.

“We are very excited about our prospects this year,” Mr. Reed said. “We have an array of new products, a much improved information system, exceptional new talent from Sturm Foods and S.T. Specialty Foods, and continued momentum from our customers’ desire to offer high quality and differentiated products for consumers.”

In addition to its financial results, TreeHouse announced David B. Vermylen will transition from president and chief operating officer to a role as a senior adviser, effective July 1, 2011. Also at that time, Mr. Reed will add the title of president.

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