North Carolina
(State or other jurisdiction of
incorporation or organization)
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56-0292920
(I.R.S. Employer Identification No.)
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13515 Ballantyne Corporate Place
Charlotte, North Carolina
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28277
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(Address of principal executive offices)
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(Zip Code)
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Large accelerated filer
þ
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Accelerated filer
o
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Non-accelerated filer
o
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Smaller reporting company
o
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(Do not check if a smaller reporting company)
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Emerging growth company
o
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Page
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Quarter Ended
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Nine Months Ended
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||||||||||||
(in thousands, except per share data)
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September 30,
2017 |
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October 1,
2016 |
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September 30,
2017 |
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October 1,
2016 |
||||||||
Net revenue
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$
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564,184
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$
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543,903
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$
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1,675,280
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$
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1,553,064
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Cost of sales
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357,993
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344,807
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1,074,036
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999,322
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Gross profit
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206,191
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199,096
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601,244
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553,742
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Selling, general and administrative expenses
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154,811
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152,980
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493,513
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434,656
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Transaction and integration related expenses
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276
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3,656
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1,861
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62,579
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Impairment charges
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105,230
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507
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113,150
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1,370
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Other operating (income)/expense, net
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(279
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)
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(3,776
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)
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196
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(5,195
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)
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Operating (loss)/income
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(53,847
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)
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45,729
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(7,476
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)
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60,332
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||||
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Other (income)/expense, net
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(227
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)
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305
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(1,461
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)
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(250
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)
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(Loss)/income before interest and income taxes
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(53,620
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)
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45,424
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(6,015
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)
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60,582
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Loss on early extinguishment of debt
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—
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—
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—
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4,749
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Interest expense, net
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10,141
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9,215
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28,587
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23,305
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(Loss)/income before income taxes
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(63,761
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)
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36,209
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(34,602
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)
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32,528
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Income tax (benefit)/expense
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(6,043
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)
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10,663
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6,889
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9,430
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(Loss)/income from continuing operations
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(57,718
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)
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25,546
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(41,491
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)
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23,098
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Income from discontinued operations, net of income taxes
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1,473
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3,655
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1,132
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326
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Net (loss)/income
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(56,245
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)
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29,201
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(40,359
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)
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23,424
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Net income/(loss) attributable to non-controlling interests
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18
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(114
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)
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772
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(141
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)
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Net (loss)/income attributable to Snyder’s-Lance, Inc.
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$
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(56,263
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)
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$
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29,315
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$
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(41,131
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)
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$
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23,565
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Amounts attributable to Snyder's-Lance, Inc.:
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Continuing operations
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$
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(57,736
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)
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$
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25,660
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$
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(42,263
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)
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$
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23,239
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Discontinued operations
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1,473
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3,655
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1,132
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326
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Net (loss)/income attributable to Snyder's-Lance, Inc.
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$
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(56,263
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)
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$
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29,315
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$
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(41,131
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)
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$
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23,565
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Basic (loss)/earnings per share:
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Continuing operations
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$
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(0.60
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)
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$
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0.26
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$
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(0.44
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)
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$
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0.26
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Discontinued operations
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0.02
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0.04
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0.01
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—
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Total basic (loss)/earnings per share
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$
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(0.58
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)
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$
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0.30
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$
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(0.43
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)
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$
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0.26
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Weighted average shares outstanding - basic
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96,642
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95,881
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96,428
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90,504
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Diluted (loss)/earnings per share:
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Continuing operations
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$
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(0.60
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)
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$
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0.26
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$
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(0.44
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)
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$
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0.26
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Discontinued operations
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0.02
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0.04
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0.01
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—
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Total diluted (loss)/earnings per share
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$
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(0.58
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)
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$
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0.30
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$
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(0.43
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)
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$
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0.26
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Weighted average shares outstanding - diluted
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96,642
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97,012
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96,428
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91,493
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Dividends declared per common share
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$
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0.16
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$
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0.16
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$
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0.48
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$
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0.48
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Quarter Ended
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Nine Months Ended
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(in thousands)
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September 30,
2017 |
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October 1,
2016 |
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September 30,
2017 |
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October 1,
2016 |
||||||||
Net (loss)/income
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$
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(56,245
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)
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$
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29,201
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$
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(40,359
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)
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$
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23,424
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Net unrealized gain/(loss) on derivative instruments, net of income tax
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131
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|
|
378
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(1,763
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)
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(1,249
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)
|
||||
Foreign currency translation adjustment
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6,276
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(6,811
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)
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16,739
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(24,226
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)
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||||
Total other comprehensive income/(loss)
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6,407
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(6,433
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)
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14,976
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(25,475
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)
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Total comprehensive (loss)/income
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(49,838
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)
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22,768
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(25,383
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)
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(2,051
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)
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Comprehensive income/(loss) attributable to non-controlling interests
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18
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(114
|
)
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|
772
|
|
|
(141
|
)
|
||||
Total comprehensive (loss)/income attributable to Snyder’s-Lance, Inc.
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|
$
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(49,856
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)
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$
|
22,882
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$
|
(26,155
|
)
|
|
$
|
(1,910
|
)
|
(in thousands, except share and per share data)
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|
September 30,
2017 |
|
December 31,
2016 |
||||
ASSETS
|
|
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|
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Current assets:
|
|
|
|
|
||||
Cash and cash equivalents
|
|
$
|
22,690
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|
|
$
|
35,409
|
|
Restricted cash
|
|
446
|
|
|
714
|
|
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Accounts receivable, net of allowances of $1,400 and $1,290, respectively
|
|
220,856
|
|
|
210,723
|
|
||
Receivable from the sale of Diamond of California
|
|
—
|
|
|
118,577
|
|
||
Inventories, net
|
|
194,769
|
|
|
173,456
|
|
||
Prepaid income taxes and income taxes receivable
|
|
7,526
|
|
|
5,744
|
|
||
Assets held for sale
|
|
20,790
|
|
|
19,568
|
|
||
Prepaid expenses and other current assets
|
|
32,558
|
|
|
27,666
|
|
||
Total current assets
|
|
499,635
|
|
|
591,857
|
|
||
|
|
|
|
|
||||
Noncurrent assets:
|
|
|
|
|
||||
Fixed assets, net
|
|
495,798
|
|
|
501,884
|
|
||
Goodwill
|
|
1,280,934
|
|
|
1,318,362
|
|
||
Other intangible assets, net
|
|
1,306,955
|
|
|
1,373,800
|
|
||
Other noncurrent assets
|
|
53,031
|
|
|
48,173
|
|
||
Total assets
|
|
$
|
3,636,353
|
|
|
$
|
3,834,076
|
|
|
|
|
|
|
||||
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
|
|
||||
Current liabilities:
|
|
|
|
|
||||
Current portion of long-term debt
|
|
$
|
49,000
|
|
|
$
|
49,000
|
|
Accounts payable
|
|
123,629
|
|
|
99,249
|
|
||
Accrued compensation
|
|
30,806
|
|
|
44,901
|
|
||
Accrued casualty insurance claims
|
|
3,302
|
|
|
4,266
|
|
||
Accrued marketing, selling and promotional costs
|
|
56,868
|
|
|
50,179
|
|
||
Other payables and accrued liabilities
|
|
42,980
|
|
|
47,958
|
|
||
Total current liabilities
|
|
306,585
|
|
|
295,553
|
|
||
|
|
|
|
|
||||
Noncurrent liabilities:
|
|
|
|
|
||||
Long-term debt, net
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1,070,153
|
|
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1,245,959
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|
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Deferred income taxes, net
|
|
392,105
|
|
|
378,236
|
|
||
Accrued casualty insurance claims
|
|
14,845
|
|
|
13,049
|
|
||
Other noncurrent liabilities
|
|
22,508
|
|
|
25,609
|
|
||
Total liabilities
|
|
1,806,196
|
|
|
1,958,406
|
|
||
|
|
|
|
|
||||
Commitments and contingencies
|
|
|
|
|
|
|
||
|
|
|
|
|
||||
Stockholders’ equity:
|
|
|
|
|
||||
Common stock, $0.83 1/3 par value. 110,000,000 shares authorized; 96,967,937 and 96,242,784 shares outstanding, respectively
|
|
80,802
|
|
|
80,199
|
|
||
Preferred stock, $1.00 par value. 5,000,000 shares authorized; no shares outstanding
|
|
—
|
|
|
—
|
|
||
Additional paid-in capital
|
|
1,624,318
|
|
|
1,598,678
|
|
||
Retained earnings
|
|
108,229
|
|
|
195,733
|
|
||
Accumulated other comprehensive loss
|
|
(3,001
|
)
|
|
(17,977
|
)
|
||
Total Snyder’s-Lance, Inc. stockholders’ equity
|
|
1,810,348
|
|
|
1,856,633
|
|
||
Non-controlling interests
|
|
19,809
|
|
|
19,037
|
|
||
Total stockholders’ equity
|
|
1,830,157
|
|
|
1,875,670
|
|
||
Total liabilities and stockholders’ equity
|
|
$
|
3,636,353
|
|
|
$
|
3,834,076
|
|
|
|
Nine Months Ended
|
||||||
(in thousands)
|
|
September 30,
2017 |
|
October 1,
2016 |
||||
Operating activities:
|
|
|
|
|
||||
Net (loss)/income
|
|
$
|
(40,359
|
)
|
|
$
|
23,424
|
|
Adjustments to reconcile net (loss)/income to cash from operating activities:
|
|
|
|
|
||||
Depreciation and amortization
|
|
73,250
|
|
|
72,687
|
|
||
Stock-based compensation expense
|
|
11,456
|
|
|
22,542
|
|
||
Loss/(gain) on sale of fixed assets, net
|
|
1,047
|
|
|
(25
|
)
|
||
Gain on sale of Diamond of California
|
|
(1,795
|
)
|
|
—
|
|
||
Gain on sale of route businesses, net
|
|
(1,744
|
)
|
|
(650
|
)
|
||
Changes in fair value of investments
|
|
—
|
|
|
179
|
|
||
Loss on early extinguishment of debt
|
|
—
|
|
|
4,749
|
|
||
Impairment charges
|
|
113,150
|
|
|
1,370
|
|
||
Deferred income taxes
|
|
7,260
|
|
|
7,139
|
|
||
Provision for doubtful accounts
|
|
639
|
|
|
218
|
|
||
Changes in operating assets and liabilities, excluding business acquisitions, divestitures and foreign currency translation adjustments
|
|
(28,631
|
)
|
|
35,165
|
|
||
Net cash provided by operating activities
|
|
134,273
|
|
|
166,798
|
|
||
|
|
|
|
|
||||
Investing activities:
|
|
|
|
|
||||
Purchases of fixed assets
|
|
(54,828
|
)
|
|
(55,823
|
)
|
||
Purchases of route businesses
|
|
(43,977
|
)
|
|
(16,467
|
)
|
||
Purchase of equity method investment
|
|
(1,500
|
)
|
|
—
|
|
||
Proceeds from sale of fixed assets and insurance recoveries
|
|
290
|
|
|
1,094
|
|
||
Proceeds from sale of route businesses
|
|
45,070
|
|
|
14,894
|
|
||
Proceeds from sale of investments
|
|
321
|
|
|
—
|
|
||
Proceeds from sale of discontinued operations
|
|
120,480
|
|
|
—
|
|
||
Business acquisitions, net of cash acquired
|
|
(2,561
|
)
|
|
(1,043,042
|
)
|
||
Net cash provided by/(used in) investing activities
|
|
63,295
|
|
|
(1,099,344
|
)
|
||
|
|
|
|
|
||||
Financing activities:
|
|
|
|
|
||||
Dividends paid to stockholders
|
|
(46,373
|
)
|
|
(42,078
|
)
|
||
Debt issuance costs
|
|
(2,441
|
)
|
|
(6,047
|
)
|
||
Issuances of common stock
|
|
16,669
|
|
|
9,001
|
|
||
Excess tax benefits from stock-based compensation
|
|
—
|
|
|
577
|
|
||
Share repurchases, including shares surrendered for tax withholding
|
|
(1,882
|
)
|
|
(8,485
|
)
|
||
Payments on capital leases
|
|
(1,642
|
)
|
|
(1,745
|
)
|
||
Repayments of long-term debt
|
|
(36,750
|
)
|
|
(232,560
|
)
|
||
Proceeds from issuance of long-term debt
|
|
—
|
|
|
1,130,000
|
|
||
Repayments of revolving credit facility
|
|
(283,500
|
)
|
|
(75,000
|
)
|
||
Proceeds from revolving credit facility
|
|
144,500
|
|
|
147,000
|
|
||
Net cash (used in)/provided by financing activities
|
|
(211,419
|
)
|
|
920,663
|
|
||
|
|
|
|
|
||||
Effect of exchange rate changes on cash
|
|
864
|
|
|
(660
|
)
|
||
|
|
|
|
|
||||
Net decrease
|
|
(12,987
|
)
|
|
(12,543
|
)
|
||
Cash, cash equivalents and restricted cash at beginning of period
|
|
36,123
|
|
|
40,071
|
|
||
Cash, cash equivalents and restricted cash at end of period
|
|
$
|
23,136
|
|
|
$
|
27,528
|
|
|
|
|
|
|
||||
Supplemental information:
|
|
|
|
|
||||
Cash paid for income taxes, net of refunds of $330 and $1,522, respectively
|
|
$
|
4,972
|
|
|
$
|
5,060
|
|
Cash paid for interest
|
|
$
|
27,233
|
|
|
$
|
22,414
|
|
|
|
|
|
|
||||
Non-cash investing activities:
|
|
|
|
|
||||
Decrease/(increase) in fixed asset expenditures included in accounts payable
|
|
$
|
1,239
|
|
|
$
|
(1,649
|
)
|
|
|
|
|
|
||||
Non-cash financing activities:
|
|
|
|
|
||||
Common stock and stock-based compensation issued for business acquisitions
|
|
$
|
—
|
|
|
$
|
800,987
|
|
•
|
The results of operations for the 13 and
39
weeks ended
September 30, 2017
("
third quarter
of
2017
" and "
first nine months
of
2017
", respectively), and the 13 and
39
weeks ended
October 1, 2016
("
third quarter
of
2016
" and "
first nine months
of
2016
", respectively).
|
•
|
Comprehensive income for the
third quarter
of
2017
and
first nine months
of
2017
and the
third quarter
of
2016
and
first nine months
of
2016
.
|
•
|
The financial position as of
September 30, 2017
and
December 31, 2016
.
|
•
|
The cash flows for the
first nine months
of
2017
and the
first nine months
of
2016
.
|
(in thousands)
|
|
September 30,
2017 |
|
December 31,
2016 |
||||
Cash and cash equivalents
|
|
$
|
22,690
|
|
|
$
|
35,409
|
|
Restricted cash
|
|
446
|
|
|
714
|
|
||
Total cash, cash equivalents and restricted cash shown in the Condensed Consolidated Statement of Cash Flows
|
|
$
|
23,136
|
|
|
$
|
36,123
|
|
(in thousands)
|
|
Previous Classification
(1)
|
|
Impact
|
|
Current Classification
|
||||||
Operating activities:
|
|
|
|
|
|
|
||||||
Gain on write-off of debt premium
|
|
$
|
(1,341
|
)
|
|
$
|
1,341
|
|
|
$
|
—
|
|
Loss on early extinguishment of debt
|
|
—
|
|
|
4,749
|
|
|
4,749
|
|
|||
Changes in operating assets and liabilities, excluding business acquisitions, divestitures and foreign currency translation adjustments
|
|
35,085
|
|
|
80
|
|
|
35,165
|
|
|||
Net cash provided by operating activities
|
|
160,628
|
|
|
6,170
|
|
|
166,798
|
|
|||
|
|
|
|
|
|
|
||||||
Financing activities:
|
|
|
|
|
|
|
||||||
Repayments of long-term debt
|
|
(226,390
|
)
|
|
(6,170
|
)
|
|
(232,560
|
)
|
|||
Net cash provided by financing activities
|
|
$
|
926,833
|
|
|
$
|
(6,170
|
)
|
|
$
|
920,663
|
|
•
|
Excess tax benefits for share-based payments were previously recognized through income tax receivable and equity, and presented as a financing cash flow. As a result of adopting this accounting standard, excess tax benefits for share-based payments are recognized as an adjustment to income tax expense and reflected in operating cash flows. We elected to adopt this provision of the accounting standard prospectively which resulted in income tax benefit of
$0.9 million
and
$2.5 million
for the
third quarter
and
first nine months
of
2017
, respectively.
|
•
|
The guidance allows the employer to withhold up to the maximum statutory tax rates in the applicable jurisdictions without triggering liability accounting. Our accounting treatment of outstanding equity awards was not impacted by our adoption of this provision of the accounting standard.
|
•
|
The guidance allows for a policy election to account for forfeitures as they occur rather than on an estimated basis. We did not make this election, and continue to account for forfeitures on an estimated basis.
|
•
|
Slotting fees, which are currently amortized over the lesser of their arrangement term or 12 months, but under the new standard these slotting fees will be recognized as a reduction in the transaction price as the product is sold. This could lead to a difference in the timing of recognizing revenue.
|
•
|
Coupon liabilities will commence when control of the goods are transferred to the customer rather than when the coupon is distributed, which will accelerate the recognition of coupon expense under the new standard.
|
•
|
Contract manufacturing arrangements are recognized as revenue when product is delivered to the customer. If any of our contracts create an asset without an alternative use and an enforceable right to payment, then we would recognize revenue at the time of production rather than shipment under the new standard. The right to payment is enforceable under certain contracts.
|
|
|
Quarter Ended
|
|
Nine Months Ended
|
||||||||||||
(in thousands)
|
|
September 30,
2017 |
|
October 1,
2016 |
|
September 30,
2017 |
|
October 1,
2016 |
||||||||
Net revenue
|
|
$
|
—
|
|
|
$
|
44,898
|
|
|
$
|
—
|
|
|
$
|
108,002
|
|
Cost of sales
|
|
—
|
|
|
30,922
|
|
|
—
|
|
|
88,235
|
|
||||
Gross profit
|
|
—
|
|
|
13,976
|
|
|
—
|
|
|
19,767
|
|
||||
Selling, general and administrative expenses
|
|
—
|
|
|
8,127
|
|
|
—
|
|
|
18,158
|
|
||||
Transaction and integration related expenses
|
|
—
|
|
|
387
|
|
|
—
|
|
|
1,404
|
|
||||
Gain on sale of Diamond of California
|
|
(2,335
|
)
|
|
—
|
|
|
(1,795
|
)
|
|
—
|
|
||||
Income from discontinued operations before income taxes
|
|
2,335
|
|
|
5,462
|
|
|
1,795
|
|
|
205
|
|
||||
Income tax expense/(benefit)
|
|
862
|
|
|
1,807
|
|
|
663
|
|
|
(121
|
)
|
||||
Income from discontinued operations, net of income taxes
|
|
$
|
1,473
|
|
|
$
|
3,655
|
|
|
$
|
1,132
|
|
|
$
|
326
|
|
|
|
Nine Months Ended
|
||||||
(in thousands)
|
|
September 30,
2017 |
|
October 1,
2016 |
||||
Cash flows from discontinued operating activities:
|
|
|
|
|
||||
Depreciation and amortization
|
|
$
|
—
|
|
|
$
|
3,280
|
|
Stock-based compensation expense
|
|
—
|
|
|
513
|
|
||
Gain on sale of Diamond of California
|
|
(1,795
|
)
|
|
—
|
|
||
Payable to growers
(1)
|
|
—
|
|
|
1,156
|
|
||
|
|
|
|
|
||||
Cash flows from discontinued investing activities:
|
|
|
|
|
||||
Purchases of fixed assets
|
|
$
|
—
|
|
|
$
|
182
|
|
|
|
Quarter Ended
|
Nine Months Ended
|
||||
(in thousands)
|
|
October 1,
2016 |
October 1,
2016 |
||||
Net revenue
(1)
|
|
$
|
588,801
|
|
$
|
1,790,680
|
|
Net income attributable to Snyder's-Lance, Inc.
(1)
|
|
$
|
29,315
|
|
$
|
72,707
|
|
•
|
SG&A Expense Efficiency.
Reduce direct spending and accelerate zero-based budgeting to improve indirect costs.
|
•
|
Manufacturing and Supply Chain Productivity.
Reduce manufacturing and distribution network complexity and improve productivity.
|
•
|
Product and Portfolio Optimization.
Reduce business complexity through stock keeping unit ("SKU") rationalization and ongoing portfolio maintenance.
|
•
|
Price Realization.
Improve trade spend productivity and effectiveness and optimize brand assortment.
|
•
|
Marketing Investment Optimization.
Reset working/non-working ratios and increase investment in our core branded portfolio.
|
•
|
Channel Execution Excellence.
Elevate the performance of the existing independent business owner direct store delivery partnership.
|
(in thousands)
|
|
Severance and Related Costs
(1)
|
|
Asset Impairments
|
|
Professional Fees
|
|
Other
|
|
Total
|
||||||||||
Liability balance, December 31, 2016
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Charges
|
|
8,607
|
|
|
7,216
|
|
|
7,278
|
|
|
681
|
|
|
23,782
|
|
|||||
Cash spent
|
|
(5,861
|
)
|
|
—
|
|
|
(6,365
|
)
|
|
—
|
|
|
(12,226
|
)
|
|||||
Non-cash settlements/adjustments
|
|
(209
|
)
|
|
(7,216
|
)
|
|
—
|
|
|
(681
|
)
|
|
(8,106
|
)
|
|||||
Liability balance, September 30, 2017
|
|
$
|
2,537
|
|
|
$
|
—
|
|
|
$
|
913
|
|
|
$
|
—
|
|
|
$
|
3,450
|
|
(in thousands)
|
|
Quarter Ended
|
|
Nine Months Ended
|
||||
|
September 30, 2017
|
|
September 30, 2017
|
|||||
Cost of sales
|
|
$
|
838
|
|
|
$
|
3,568
|
|
Selling, general, and administrative
|
|
6,252
|
|
|
12,998
|
|
||
Impairment charges
|
|
—
|
|
|
7,216
|
|
||
Total
|
|
$
|
7,090
|
|
|
$
|
23,782
|
|
|
|
Quarter Ended
|
|
Nine Months Ended
|
||||||||||||
(in thousands, except per share data)
|
|
September 30,
2017 |
|
October 1,
2016 |
|
September 30,
2017 |
|
October 1,
2016 |
||||||||
Basic EPS:
|
|
|
|
|
|
|
|
|
||||||||
Income/(loss) from continuing operations attributable to Snyder's-Lance, Inc.
|
|
$
|
(57,736
|
)
|
|
$
|
25,660
|
|
|
$
|
(42,263
|
)
|
|
$
|
23,239
|
|
Less: Income from continuing operations allocated to participating securities
|
|
—
|
|
|
41
|
|
|
—
|
|
|
—
|
|
||||
Income/(loss) from continuing operations allocated to common shares
|
|
$
|
(57,736
|
)
|
|
$
|
25,619
|
|
|
$
|
(42,263
|
)
|
|
$
|
23,239
|
|
Weighted average shares outstanding – Basic
|
|
96,642
|
|
|
95,881
|
|
|
96,428
|
|
|
90,504
|
|
||||
Earnings/(loss) per share – Basic
|
|
$
|
(0.60
|
)
|
|
$
|
0.26
|
|
|
$
|
(0.44
|
)
|
|
$
|
0.26
|
|
|
|
|
|
|
|
|
|
|
||||||||
Diluted EPS:
|
|
|
|
|
|
|
|
|
||||||||
Weighted average shares outstanding – Basic
|
|
96,642
|
|
|
95,881
|
|
|
96,428
|
|
|
90,504
|
|
||||
Effect of dilutive stock options, restricted units and performance-based restricted units on shares outstanding
|
|
—
|
|
|
1,131
|
|
|
—
|
|
|
989
|
|
||||
Weighted average shares outstanding – Diluted
|
|
96,642
|
|
|
97,012
|
|
|
96,428
|
|
|
91,493
|
|
||||
Earnings/(loss) per share – Diluted
|
|
$
|
(0.60
|
)
|
|
$
|
0.26
|
|
|
$
|
(0.44
|
)
|
|
$
|
0.26
|
|
(in thousands)
|
|
September 30,
2017 |
|
December 31,
2016 |
||||
Finished goods and work in process
|
|
$
|
122,860
|
|
|
$
|
102,056
|
|
Raw materials
|
|
26,216
|
|
|
32,095
|
|
||
Maintenance parts, packaging and supplies
|
|
45,693
|
|
|
39,305
|
|
||
Total inventories, net
|
|
$
|
194,769
|
|
|
$
|
173,456
|
|
(in thousands)
|
|
September 30,
2017 |
|
December 31,
2016 |
||||
Land and land improvements
|
|
$
|
38,209
|
|
|
$
|
37,835
|
|
Buildings and building improvements
|
|
192,210
|
|
|
192,874
|
|
||
Machinery, equipment and computer systems
|
|
650,850
|
|
|
607,869
|
|
||
Trucks, trailers and automobiles
|
|
33,350
|
|
|
32,723
|
|
||
Furniture and fixtures
|
|
4,612
|
|
|
4,720
|
|
||
Construction in progress
|
|
19,968
|
|
|
22,098
|
|
||
Capital leases
(1)
|
|
2,722
|
|
|
3,303
|
|
||
|
|
941,921
|
|
|
901,422
|
|
||
Accumulated depreciation
|
|
(446,090
|
)
|
|
(399,472
|
)
|
||
|
|
495,831
|
|
|
501,950
|
|
||
Fixed assets held for sale
|
|
(33
|
)
|
|
(66
|
)
|
||
Fixed assets, net
|
|
$
|
495,798
|
|
|
$
|
501,884
|
|
(in thousands)
|
|
Carrying Amount
|
||
Balance as of December 31, 2016
|
|
$
|
1,318,362
|
|
Business acquisition and measurement period adjustments
|
|
2,876
|
|
|
Changes in foreign currency exchange rates
|
|
6,191
|
|
|
Goodwill reclassified to assets held for sale
|
|
(160
|
)
|
|
Impairments
|
|
(46,335
|
)
|
|
Balance as of September 30, 2017
|
|
$
|
1,280,934
|
|
(in thousands)
|
|
Gross
Carrying
Amount
|
|
Cumulative Impairments
|
|
Accumulated
Amortization
|
|
Net
Carrying
Amount
|
||||||||
As of September 30, 2017:
|
|
|
|
|
|
|
|
|
||||||||
Customer and contractual relationships
(1)
– amortized
|
|
$
|
501,218
|
|
|
$
|
—
|
|
|
$
|
(78,417
|
)
|
|
$
|
422,801
|
|
Non-compete agreement – amortized
|
|
710
|
|
|
—
|
|
|
(507
|
)
|
|
203
|
|
||||
Developed technology – amortized
|
|
2,700
|
|
|
—
|
|
|
(595
|
)
|
|
2,105
|
|
||||
Reacquired rights – amortized
|
|
3,100
|
|
|
—
|
|
|
(2,392
|
)
|
|
708
|
|
||||
Patents – amortized
|
|
8,600
|
|
|
—
|
|
|
(3,894
|
)
|
|
4,706
|
|
||||
Routes – unamortized
|
|
10,425
|
|
|
(45
|
)
|
|
—
|
|
|
10,380
|
|
||||
Trademarks
(2)
– unamortized
|
|
931,137
|
|
|
(65,085
|
)
|
|
—
|
|
|
866,052
|
|
||||
Balance as of September 30, 2017
|
|
$
|
1,457,890
|
|
|
$
|
(65,130
|
)
|
|
$
|
(85,805
|
)
|
|
$
|
1,306,955
|
|
|
|
|
|
|
|
|
|
|
||||||||
As of December 31, 2016:
|
|
|
|
|
|
|
|
|
||||||||
Customer and contractual relationships – amortized
|
|
$
|
493,026
|
|
|
$
|
—
|
|
|
$
|
(58,314
|
)
|
|
$
|
434,712
|
|
Non-compete agreement – amortized
|
|
710
|
|
|
—
|
|
|
(417
|
)
|
|
293
|
|
||||
Developed technology – amortized
|
|
2,700
|
|
|
—
|
|
|
(460
|
)
|
|
2,240
|
|
||||
Reacquired rights – amortized
|
|
3,100
|
|
|
—
|
|
|
(2,101
|
)
|
|
999
|
|
||||
Patents – amortized
|
|
8,600
|
|
|
—
|
|
|
(3,308
|
)
|
|
5,292
|
|
||||
Routes – unamortized
|
|
10,869
|
|
|
(45
|
)
|
|
—
|
|
|
10,824
|
|
||||
Trademarks – unamortized
|
|
926,140
|
|
|
(6,700
|
)
|
|
—
|
|
|
919,440
|
|
||||
Balance as of December 31, 2016
|
|
$
|
1,445,145
|
|
|
$
|
(6,745
|
)
|
|
$
|
(64,600
|
)
|
|
$
|
1,373,800
|
|
(in thousands)
|
|
Carrying Amount
|
||
Balance as of December 31, 2016
|
|
$
|
10,824
|
|
Routes reclassified to assets held for sale
|
|
(444
|
)
|
|
Balance as of September 30, 2017
|
|
$
|
10,380
|
|
(in thousands)
|
|
Carrying Amount
|
||
Balance as of December 31, 2016
|
|
$
|
19,502
|
|
Purchases of route businesses held for sale
|
|
43,977
|
|
|
Sales of route businesses held for sale
|
|
(43,327
|
)
|
|
Reclassifications from route intangibles and goodwill
|
|
604
|
|
|
Balance as of September 30, 2017
|
|
$
|
20,756
|
|
(in thousands)
|
|
September 30,
2017 |
|
December 31,
2016 |
||||
Revolving credit facility
|
|
$
|
88,000
|
|
|
$
|
227,000
|
|
Other long-term debt
|
|
1,041,500
|
|
|
1,078,250
|
|
||
Debt issuance costs, net
|
|
(10,347
|
)
|
|
(10,291
|
)
|
||
Total debt, net
|
|
1,119,153
|
|
|
1,294,959
|
|
||
Current portion of long-term debt
|
|
(49,000
|
)
|
|
(49,000
|
)
|
||
Total long-term debt, net
|
|
$
|
1,070,153
|
|
|
$
|
1,245,959
|
|
(in thousands)
|
|
Amount
|
||
Repayment of private placement senior notes
|
|
$
|
100,000
|
|
Penalty on early extinguishment
|
|
6,170
|
|
|
Book value of private placement debt, including unamortized fair value adjustment
|
|
(101,421
|
)
|
|
Loss on early extinguishment of debt
|
|
$
|
4,749
|
|
Level 1
|
–
|
quoted prices in active markets for identical assets and liabilities.
|
Level 2
|
–
|
observable inputs other than quoted prices for identical assets and liabilities.
|
Level 3
|
–
|
unobservable inputs for which there is little or no market data available, which required us to develop our own assumptions.
|
(in thousands)
|
|
Book Value
|
|
Quoted Prices in Active Markets for Identical Assets (Level 1)
|
|
Significant Other Observable Inputs (Level 2)
|
|
Significant Unobservable Inputs (Level 3)
|
||||||||
Balance as of September 30, 2017
|
|
|
|
|
|
|
|
|
||||||||
Assets:
|
|
|
|
|
|
|
|
|
||||||||
Cash and cash equivalents
|
|
$
|
22,690
|
|
|
$
|
22,690
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Restricted cash
|
|
446
|
|
|
446
|
|
|
—
|
|
|
—
|
|
||||
Interest rate swaps
|
|
8,570
|
|
|
—
|
|
|
8,570
|
|
|
—
|
|
||||
Total assets
|
|
$
|
31,706
|
|
|
$
|
23,136
|
|
|
$
|
8,570
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
||||||||
Liabilities:
|
|
|
|
|
|
|
|
|
||||||||
Interest rate swaps
|
|
1,093
|
|
|
$
|
—
|
|
|
$
|
1,093
|
|
|
$
|
—
|
|
|
Total liabilities
|
|
$
|
1,093
|
|
|
$
|
—
|
|
|
$
|
1,093
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
||||||||
Balance as of December 31, 2016
|
|
|
|
|
|
|
|
|
||||||||
Assets:
|
|
|
|
|
|
|
|
|
||||||||
Cash and cash equivalents
|
|
$
|
35,409
|
|
|
$
|
35,409
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Restricted cash
|
|
714
|
|
|
714
|
|
|
—
|
|
|
—
|
|
||||
Interest rate swaps
|
|
10,748
|
|
|
—
|
|
|
10,748
|
|
|
—
|
|
||||
Total assets
|
|
$
|
46,871
|
|
|
$
|
36,123
|
|
|
$
|
10,748
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
||||||||
Liabilities:
|
|
|
|
|
|
|
|
|
||||||||
Interest rate swaps
|
|
$
|
392
|
|
|
$
|
—
|
|
|
$
|
392
|
|
|
$
|
—
|
|
Total liabilities
|
|
$
|
392
|
|
|
$
|
—
|
|
|
$
|
392
|
|
|
$
|
—
|
|
(in thousands)
|
|
Balance Sheet Location
|
|
September 30,
2017 |
|
December 31,
2016 |
||||
Derivatives designated as hedges:
|
|
|
|
|
|
|
||||
Interest rate swaps
|
|
Other noncurrent assets
|
|
$
|
8,570
|
|
|
$
|
10,748
|
|
Interest rate swaps
|
|
Other noncurrent liabilities
|
|
(1,093
|
)
|
|
(392
|
)
|
||
Total fair value of derivative instruments
|
|
|
|
$
|
7,477
|
|
|
$
|
10,356
|
|
|
|
Quarter Ended
|
|
Nine Months Ended
|
||||||||||||
(in thousands)
|
|
September 30,
2017 |
|
October 1,
2016 |
|
September 30,
2017 |
|
October 1,
2016 |
||||||||
Gains/(losses) on interest rate swaps, net of income tax (expense)/benefit of $(84), $(234), $1,116 and $794, respectively
|
|
$
|
131
|
|
|
$
|
378
|
|
|
$
|
(1,763
|
)
|
|
$
|
(1,249
|
)
|
|
|
Income Statement Location
|
|
Quarter Ended
|
|
Nine Months Ended
|
||||||||||||
(in thousands)
|
|
|
September 30,
2017 |
|
October 1,
2016 |
|
September 30,
2017 |
|
October 1,
2016 |
|||||||||
Losses on cash flow hedges reclassified out of accumulated other comprehensive loss:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Interest rate swaps, net of tax benefit of $189, $98, $337 and $299, respectively
|
|
Interest expense, net
|
|
$
|
(282
|
)
|
|
$
|
(158
|
)
|
|
$
|
(503
|
)
|
|
$
|
(477
|
)
|
Total amounts reclassified from accumulated other comprehensive loss
|
|
|
|
$
|
(282
|
)
|
|
$
|
(158
|
)
|
|
$
|
(503
|
)
|
|
$
|
(477
|
)
|
(in thousands)
|
|
Gains/(Losses) on Cash Flow Hedges
|
|
Foreign Currency Translation Adjustments
|
|
Total
|
||||||
Balance as of December 31, 2016
|
|
$
|
6,323
|
|
|
$
|
(24,300
|
)
|
|
$
|
(17,977
|
)
|
|
|
|
|
|
|
|
||||||
Other comprehensive (loss)/income before reclassifications
|
|
(2,266
|
)
|
|
16,739
|
|
|
14,473
|
|
|||
Losses reclassified from accumulated other comprehensive loss
|
|
503
|
|
|
—
|
|
|
503
|
|
|||
Total other comprehensive (loss)/income
|
|
(1,763
|
)
|
|
16,739
|
|
|
14,976
|
|
|||
|
|
|
|
|
|
|
||||||
Balance as of September 30, 2017
|
|
$
|
4,560
|
|
|
$
|
(7,561
|
)
|
|
$
|
(3,001
|
)
|
(in thousands)
|
|
Gains/(Losses) on Cash Flow Hedges
|
|
Foreign Currency Translation Adjustments
|
|
Total
|
||||||
Balance as of January 2, 2016
|
|
$
|
(630
|
)
|
|
$
|
—
|
|
|
$
|
(630
|
)
|
|
|
|
|
|
|
|
||||||
Other comprehensive loss before reclassifications
|
|
(1,726
|
)
|
|
(24,226
|
)
|
|
(25,952
|
)
|
|||
Losses reclassified from accumulated other comprehensive loss
|
|
477
|
|
|
—
|
|
|
477
|
|
|||
Total other comprehensive loss
|
|
(1,249
|
)
|
|
(24,226
|
)
|
|
(25,475
|
)
|
|||
|
|
|
|
|
|
|
||||||
Balance as of October 1, 2016
|
|
$
|
(1,879
|
)
|
|
$
|
(24,226
|
)
|
|
$
|
(26,105
|
)
|
|
|
Quarter Ended
|
|
Nine Months Ended
|
||||||||||||
(in thousands)
|
|
September 30,
2017 |
|
October 1,
2016 |
|
September 30,
2017 |
|
October 1,
2016 |
||||||||
Branded
|
|
|
|
|
|
|
|
|
||||||||
Core brand
|
|
$
|
407,785
|
|
|
$
|
388,570
|
|
|
$
|
1,208,994
|
|
|
$
|
1,078,280
|
|
Allied brand
|
|
39,604
|
|
|
38,261
|
|
|
122,296
|
|
|
117,009
|
|
||||
Total Branded
|
|
447,389
|
|
|
426,831
|
|
|
1,331,290
|
|
|
1,195,289
|
|
||||
Partner brand
|
|
73,978
|
|
|
73,821
|
|
|
222,325
|
|
|
229,607
|
|
||||
Other
|
|
42,817
|
|
|
43,251
|
|
|
121,665
|
|
|
128,168
|
|
||||
Net revenue
|
|
$
|
564,184
|
|
|
$
|
543,903
|
|
|
$
|
1,675,280
|
|
|
$
|
1,553,064
|
|
|
|
Quarter Ended
|
|
Nine Months Ended
|
||||||||||||
(in thousands)
|
|
September 30,
2017 |
|
October 1,
2016 |
|
September 30,
2017 |
|
October 1,
2016 |
||||||||
Location:
|
|
|
|
|
|
|
|
|
||||||||
United States
|
|
$
|
536,278
|
|
|
$
|
517,927
|
|
|
$
|
1,593,913
|
|
|
$
|
1,485,487
|
|
International
|
|
27,906
|
|
|
25,976
|
|
|
81,367
|
|
|
67,577
|
|
||||
Net revenue
|
|
$
|
564,184
|
|
|
$
|
543,903
|
|
|
$
|
1,675,280
|
|
|
$
|
1,553,064
|
|
(in thousands)
|
|
September 30,
2017 |
|
December 31,
2016 |
||||
Location:
|
|
|
|
|
||||
United States
|
|
$
|
469,832
|
|
|
$
|
477,450
|
|
International
|
|
25,966
|
|
|
24,434
|
|
||
Total
|
|
$
|
495,798
|
|
|
$
|
501,884
|
|
•
|
We recognized
$104.7 million
in non-cash impairment charges to our goodwill and other intangible assets;
|
•
|
We incurred
$7.1 million
in charges related to the Transformation Plan; and
|
•
|
We incurred
$2.5 million
in costs related to relocating production from Stockton, California, and associated professional fees due to our divestiture of the Diamond of California business.
|
|
|
Quarter Ended
|
|
Favorable/
(Unfavorable) Variance |
|||||||||||||||||
(in thousands)
|
|
September 30, 2017
|
|
October 1, 2016
|
|
||||||||||||||||
Net revenue
|
|
$
|
564,184
|
|
|
100.0
|
%
|
|
$
|
543,903
|
|
|
100.0
|
%
|
|
$
|
20,281
|
|
|
3.7
|
%
|
Cost of sales
|
|
357,993
|
|
|
63.5
|
%
|
|
344,807
|
|
|
63.4
|
%
|
|
(13,186
|
)
|
|
(3.8
|
)%
|
|||
Gross profit
|
|
206,191
|
|
|
36.5
|
%
|
|
199,096
|
|
|
36.6
|
%
|
|
7,095
|
|
|
3.6
|
%
|
|||
Selling, general and administrative expenses
|
|
154,811
|
|
|
27.3
|
%
|
|
152,980
|
|
|
28.1
|
%
|
|
(1,831
|
)
|
|
(1.2
|
)%
|
|||
Transaction and integration related expenses
|
|
276
|
|
|
—
|
%
|
|
3,656
|
|
|
0.7
|
%
|
|
3,380
|
|
|
92.5
|
%
|
|||
Impairment charges
|
|
105,230
|
|
|
18.7
|
%
|
|
507
|
|
|
0.1
|
%
|
|
(104,723
|
)
|
|
nm
|
|
|||
Other operating (income)/expense, net
|
|
(279
|
)
|
|
—
|
%
|
|
(3,776
|
)
|
|
(0.7
|
)%
|
|
3,497
|
|
|
(92.6
|
)%
|
|||
Operating (loss)/income
|
|
(53,847
|
)
|
|
(9.5
|
)%
|
|
45,729
|
|
|
8.4
|
%
|
|
(99,576
|
)
|
|
nm
|
|
|||
Other (income)/expense, net
|
|
(227
|
)
|
|
—
|
%
|
|
305
|
|
|
—
|
%
|
|
532
|
|
|
nm
|
|
|||
(Loss)/income before interest and income taxes
|
|
(53,620
|
)
|
|
(9.5
|
)%
|
|
45,424
|
|
|
8.4
|
%
|
|
(99,044
|
)
|
|
nm
|
|
|||
Interest expense, net
|
|
10,141
|
|
|
1.8
|
%
|
|
9,215
|
|
|
1.7
|
%
|
|
(926
|
)
|
|
(10.0
|
)%
|
|||
(Loss)/income before income taxes
|
|
(63,761
|
)
|
|
(11.3
|
)%
|
|
36,209
|
|
|
6.7
|
%
|
|
(99,970
|
)
|
|
nm
|
|
|||
Income tax (benefit)/expense
|
|
(6,043
|
)
|
|
(1.1
|
)%
|
|
10,663
|
|
|
2.0
|
%
|
|
16,706
|
|
|
nm
|
|
|||
(Loss)/income from continuing operations
|
|
(57,718
|
)
|
|
(10.2
|
)%
|
|
25,546
|
|
|
4.7
|
%
|
|
(83,264
|
)
|
|
nm
|
|
|||
Income from discontinued operations, net of income taxes
|
|
1,473
|
|
|
0.2
|
%
|
|
3,655
|
|
|
0.7
|
%
|
|
(2,182
|
)
|
|
(59.7
|
)%
|
|||
Net (loss)/income
|
|
$
|
(56,245
|
)
|
|
(10.0
|
)%
|
|
$
|
29,201
|
|
|
5.4
|
%
|
|
$
|
(85,446
|
)
|
|
nm
|
|
|
|
Quarter Ended
|
|
Favorable/
(Unfavorable) Variance |
|||||||||||||||||
(in thousands)
|
|
September 30, 2017
|
|
October 1, 2016
|
|
||||||||||||||||
Branded
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Core brand
|
|
$
|
407,785
|
|
|
72.3
|
%
|
|
$
|
388,570
|
|
|
71.4
|
%
|
|
$
|
19,215
|
|
|
4.9
|
%
|
Allied brand
|
|
39,604
|
|
|
7.0
|
%
|
|
38,261
|
|
|
7.1
|
%
|
|
1,343
|
|
|
3.5
|
%
|
|||
Total Branded
|
|
447,389
|
|
|
79.3
|
%
|
|
426,831
|
|
|
78.5
|
%
|
|
20,558
|
|
|
4.8
|
%
|
|||
Partner brand
|
|
73,978
|
|
|
13.1
|
%
|
|
73,821
|
|
|
13.6
|
%
|
|
157
|
|
|
0.2
|
%
|
|||
Other
|
|
42,817
|
|
|
7.6
|
%
|
|
43,251
|
|
|
7.9
|
%
|
|
(434
|
)
|
|
(1.0
|
)%
|
|||
Net revenue
|
|
$
|
564,184
|
|
|
100.0
|
%
|
|
$
|
543,903
|
|
|
100.0
|
%
|
|
$
|
20,281
|
|
|
3.7
|
%
|
•
|
Lance
®
branded products had double-digit revenue growth for the quarter, which outpaced the category growth and strengthened its category leadership position. This growth came from increased distribution compared to the prior year and increased sales volume driven by effective promotional programs.
|
•
|
Late July
®
branded products continued its trend of double digit growth through higher sales volume across all channels and increased distribution, gaining market share in the quarter.
|
•
|
Snack Factory
®
Pretzel Crisps
®
branded products continued to experience growth as the category leader of the deli snack category. Net revenue from these products increased due to increased volumes.
|
•
|
Snyder's of Hanover
®
branded products experienced growth for the quarter, due to new product offerings and increased sales volumes.
|
•
|
Pop Secret
®
branded products had decreased volumes that outpaced the category decline in volume.
|
•
|
Emerald
®
branded products had decreased volumes due to our inability to meet customer demand as we transition production of these products to our Charlotte, NC facility.
|
|
|
Nine Months Ended
|
|
Favorable/
(Unfavorable) Variance |
|||||||||||||||||
(in thousands)
|
|
September 30, 2017
|
|
October 1, 2016
|
|
||||||||||||||||
Net revenue
|
|
$
|
1,675,280
|
|
|
100.0
|
%
|
|
$
|
1,553,064
|
|
|
100.0
|
%
|
|
$
|
122,216
|
|
|
7.9
|
%
|
Cost of sales
|
|
1,074,036
|
|
|
64.1
|
%
|
|
999,322
|
|
|
64.3
|
%
|
|
(74,714
|
)
|
|
(7.5
|
)%
|
|||
Gross profit
|
|
601,244
|
|
|
35.9
|
%
|
|
553,742
|
|
|
35.7
|
%
|
|
47,502
|
|
|
8.6
|
%
|
|||
Selling, general and administrative expenses
|
|
493,513
|
|
|
29.4
|
%
|
|
434,656
|
|
|
28.0
|
%
|
|
(58,857
|
)
|
|
(13.5
|
)%
|
|||
Transaction and integration related expenses
|
|
1,861
|
|
|
0.1
|
%
|
|
62,579
|
|
|
4.0
|
%
|
|
60,718
|
|
|
97.0
|
%
|
|||
Impairment charges
|
|
113,150
|
|
|
6.8
|
%
|
|
1,370
|
|
|
0.1
|
%
|
|
(111,780
|
)
|
|
nm
|
|
|||
Other operating (income)/expense, net
|
|
196
|
|
|
—
|
%
|
|
(5,195
|
)
|
|
(0.3
|
)%
|
|
(5,391
|
)
|
|
nm
|
|
|||
Operating (loss)/income
|
|
(7,476
|
)
|
|
(0.4
|
)%
|
|
60,332
|
|
|
3.9
|
%
|
|
(67,808
|
)
|
|
nm
|
|
|||
Other (income)/expense, net
|
|
(1,461
|
)
|
|
—
|
%
|
|
(250
|
)
|
|
—
|
%
|
|
1,211
|
|
|
(484.4
|
)%
|
|||
(Loss)/income before interest and income taxes
|
|
(6,015
|
)
|
|
(0.4
|
)%
|
|
60,582
|
|
|
3.9
|
%
|
|
(66,597
|
)
|
|
nm
|
|
|||
Loss on early extinguishment of debt
|
|
—
|
|
|
—
|
%
|
|
4,749
|
|
|
0.3
|
%
|
|
4,749
|
|
|
nm
|
|
|||
Interest expense, net
|
|
28,587
|
|
|
1.7
|
%
|
|
23,305
|
|
|
1.5
|
%
|
|
5,282
|
|
|
22.7
|
%
|
|||
(Loss)/income before income taxes
|
|
(34,602
|
)
|
|
(2.1
|
)%
|
|
32,528
|
|
|
2.1
|
%
|
|
(67,130
|
)
|
|
nm
|
|
|||
Income tax (benefit)/expense
|
|
6,889
|
|
|
0.4
|
%
|
|
9,430
|
|
|
0.6
|
%
|
|
(2,541
|
)
|
|
(26.9
|
)%
|
|||
(Loss)/income from continuing operations
|
|
(41,491
|
)
|
|
(2.5
|
)%
|
|
23,098
|
|
|
1.5
|
%
|
|
(64,589
|
)
|
|
nm
|
|
|||
Income from discontinued operations, net of income taxes
|
|
1,132
|
|
|
0.1
|
%
|
|
326
|
|
|
—
|
%
|
|
806
|
|
|
nm
|
|
|||
Net (loss)/income
|
|
$
|
(40,359
|
)
|
|
(2.4
|
)%
|
|
$
|
23,424
|
|
|
1.5
|
%
|
|
$
|
(63,783
|
)
|
|
nm
|
|
|
|
Nine Months Ended
|
|
Favorable/
(Unfavorable) Variance |
|||||||||||||||||
(in thousands)
|
|
September 30, 2017
|
|
October 1, 2016
|
|
||||||||||||||||
Branded
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Core brand
|
|
$
|
1,208,994
|
|
|
72.2
|
%
|
|
$
|
1,078,280
|
|
|
69.4
|
%
|
|
$
|
130,714
|
|
|
12.1
|
%
|
Allied brand
|
|
122,296
|
|
|
7.3
|
%
|
|
117,009
|
|
|
7.6
|
%
|
|
5,287
|
|
|
4.5
|
%
|
|||
Total Branded
|
|
1,331,290
|
|
|
79.5
|
%
|
|
1,195,289
|
|
|
77.0
|
%
|
|
136,001
|
|
|
11.4
|
%
|
|||
Partner brand
|
|
222,325
|
|
|
13.3
|
%
|
|
229,607
|
|
|
14.8
|
%
|
|
(7,282
|
)
|
|
(3.2
|
)%
|
|||
Other
|
|
121,665
|
|
|
7.2
|
%
|
|
128,168
|
|
|
8.2
|
%
|
|
(6,503
|
)
|
|
(5.1
|
)%
|
|||
Net revenue
|
|
$
|
1,675,280
|
|
|
100.0
|
%
|
|
$
|
1,553,064
|
|
|
100.0
|
%
|
|
$
|
122,216
|
|
|
7.9
|
%
|
•
|
Snack Factory
®
and Late July
®
brands have experienced double-digit growth and strong market share gains in the current year due to expanded distribution and volumes across our channels.
|
•
|
Snyder's of Hanover
®
is up mid-single digits, driven by new product introductions in the current year and increased volumes.
|
•
|
Cape Cod
®
branded products are up mid-single digits due to increased distribution and new product introductions in the current year.
|
•
|
Lance
®
branded products are up mid-single digits with volume increases more than offsetting slight distribution losses in the first nine months of the year.
|
(in thousands)
|
|
September 30,
2017 |
|
October 1,
2016 |
||||
Net cash provided by/(used in):
|
|
|
|
|
||||
Operating activities
|
|
$
|
134,273
|
|
|
$
|
166,798
|
|
Investing activities
|
|
63,295
|
|
|
(1,099,344
|
)
|
||
Financing activities
|
|
(211,419
|
)
|
|
920,663
|
|
||
Effect of exchange rate changes on cash
|
|
864
|
|
|
(660
|
)
|
||
Net decrease in cash, cash equivalents and restricted cash
|
|
$
|
(12,987
|
)
|
|
$
|
(12,543
|
)
|
|
|
September 30, 2017
|
|
December 31, 2016
|
||||||||
|
|
Emerald
®
|
|
Pop Secret
®
|
|
KETTLE
®
Chips (U.K.)
|
|
Emerald
®
|
|
Pop Secret
®
|
|
KETTLE
®
Chips (U.K.)
|
Annual revenue growth during valuation period
|
|
1.1%
|
|
(2.0%)
|
|
1.2%
|
|
1.9%
|
|
0.7%
|
|
2.8%
|
Terminal growth rate
|
|
1.0%
|
|
1.0%
|
|
1.5%
|
|
2.0%
|
|
1.0%
|
|
2.0%
|
WACC
|
|
7.0%
|
|
7.0%
|
|
7.5%
|
|
7.0%
|
|
7.0%
|
|
7.5%
|
Royalty rate
|
|
1.5%
|
|
7.0%
|
|
6.0%
|
|
1.0%
|
|
8.0%
|
|
6.0%
|
Period
|
|
Total Number of Shares Purchased
(1)
|
|
Average Price Paid Per Share
|
|
Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs
|
|
Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs
(2)
|
|||||
July 2, 2017 - July 31, 2017
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
—
|
|
August 1, 2017 - August 31, 2017
|
|
1,300
|
|
|
36.70
|
|
|
—
|
|
|
—
|
|
|
September 1, 2017 - September 30, 2017
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Total
|
|
1,300
|
|
|
$
|
36.70
|
|
|
—
|
|
|
—
|
|
|
No.
|
Description
|
|
|
|
|
10.1*
|
|
|
|
|
|
10.2*
|
|
|
|
|
|
10.3*
|
|
|
|
|
|
10.4*
|
|
|
|
|
|
10.5*
|
|
|
|
|
|
10.6*
|
|
|
|
|
|
10.7*
|
|
|
|
|
|
31.1
|
|
|
|
|
|
31.2
|
|
|
|
|
|
32
|
|
|
|
|
|
101
|
The following financial information from the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2017, formatted in XBRL (eXtensible Business Reporting Language): (i) the Condensed Consolidated Statements of Income/(Loss), (ii) the Condensed Consolidated Statements of Comprehensive Income/(Loss), (iii) the Condensed Consolidated Balance Sheets, (iv) the Condensed Consolidated Statements of Cash Flows and (v) the Notes to the Condensed Consolidated Financial Statements.
|
|
SNYDER’S-LANCE, INC.
|
||
|
|
|
|
|
|
|
|
Date: November 9, 2017
|
By:
|
|
/s/ Alexander W. Pease
|
|
|
|
Alexander W. Pease
|
|
|
|
Executive Vice President, Chief Financial Officer
|
•
|
Ensure a strong commitment to the Company’s performance transformation by providing a meaningful reward that motivates and excites associates to be part of the three year plan.
|
a.
|
Stock Options
. The number of Performance Non-Qualified Stock Options awarded to each Participant for the Performance Period will equal the dollar value of the Participant’s Performance Stock Option Incentive divided by the Black-Scholes value of the Performance Non-Qualified Stock Options, with the result rounded up to the nearest multiple of three shares. The grant date for Performance Non-Qualified Stock Options will be the date during the Performance Period specified by the Compensation Committee upon approval of the awards and the exercise price will be the Fair Market Value of the Common Stock, which is the closing price of the Common Stock, on the grant date. Each Performance Non-Qualified Stock Option will be earned at the end of the Performance Period as described below in 5c and will vest 50% in quarter one of 2021 and 50% in quarter one of 2022. The term of each Performance Non-Qualified Stock Option will be ten years.
|
b.
|
Performance Restricted Stock
. The number of Performance Restricted Stock awarded to each Participant for a Plan Year will equal the dollar value of the Participant’s Performance Restricted Stock Incentive divided by the closing price of the Common Stock on the grant date, with the results rounded to the nearest whole share. The grant date for Performance Restricted Stock will be the date during the Performance Period specified by the Compensation Committee upon approval of the awards and the value shall be the Fair Market Value of the Common Stock on the grant date. Performance Restricted Stock Awards for the Performance Period will be earned at the end of the Performance Period as described below in 5c and will vest 50% in quarter one of 2021 and 50% in quarter one of 2022. Restrictions shall lapse as of the end of the Performance Period.
|
c.
|
Performance Goals
. The Compensation Committee will establish the Performance Goals and formula, including Threshold, Target and Maximum performance levels (to the extent applicable), for the Performance Non-Qualified Stock Options and the Performance Restricted Stock. If more than one Performance Goal applies for a Performance Period, the Compensation Committee will establish the relative weighting of the Performance Goals. For awards intended to be Qualified Performance-Based Awards, the Compensation Committee will establish the Performance Goals in a manner consistent with that intent. Award funding levels will be determined based on actual performance over the Performance Period as follows:
|
Granted To
|
Grant Date
|
Number of Shares
|
Vesting Amounts and Dates
|
PARTICIPANT NAME
|
XX/XX/XXXX
|
NUMBER OF AWARDS GRANTED
|
(See Exhibit A)
|
Expiration Date:
Ten years after
Grant Date
|
Option Price Per Share:
$$.$$
|
1.
|
Subject to the terms and conditions of the Incentive Plan and this Agreement, the Company grants to you the option to purchase from the Company the number of shares of the Company’s Common Stock stated above at the option price per share stated above (the “Option”). The Option is not intended to be an Incentive Stock Option. By accepting this Agreement, you acknowledge having read the Prospectus and agree to be bound by all of the terms and conditions of the Incentive Plan, this Agreement and the Snyder’s-Lance, Inc. 2017 Enterprise Incentive Plan (the “Plan”).
|
2.
|
The Option vests and is exercisable by you in installments as stated in the attached Exhibit A and in the event of a Change in Control as defined in the Plan. The manner of exercising the Option and the method for paying the applicable option price shall be as set forth in the Incentive Plan. You cannot exercise the Option for less than 100 shares unless such lesser number is the total number of shares for which the Option is exercisable at such time. No fractional shares will be issued. Any applicable withholding taxes must also be paid by you in accordance with the Incentive Plan. Shares issued upon exercise of the Option shall be issued solely in your name. The right to purchase shares pursuant to the Option shall be cumulative so that when the right to purchase an additional installment of shares has vested pursuant to the schedule above, such shares or any part thereof may be purchased thereafter until the expiration of the Option.
|
3.
|
You agree that, upon request, you will furnish a letter agreement providing that you will not distribute or resell in violation of the Securities Act of 1933, as amended, any of the shares acquired upon your exercise of the Option, that you will indemnify and hold the Company harmless against all liability for any such violation and that you will accept all liability for any such violation.
|
4.
|
The existence of the Option shall not affect in any way the right or power of the Company or its stockholders to make or authorize any or all adjustments, recapitalizations, reorganizations or other changes in the Company’s capital structure or its business, or any merger or consolidation of the Company, or any issue of bonds, debentures, preferred or prior preference stocks ahead of or convertible into, or otherwise affecting the Common Stock or the rights thereof, or the dissolution or liquidation of the Company, or any sale or transfer of all or any part of its assets or business, or any other corporate act or proceeding, whether of a similar character or otherwise.
|
5.
|
Any notice which either party hereto may be required or permitted to give to the other shall be in writing and may be delivered personally, by intraoffice mail, by email, by fax or by mail, postage prepaid, to such address and directed to such person(s) as the Company may notify you from time to time; and to you at your address as shown on the records of the Company from time to time, or at such other address as you, by notice to the Company, may designate in writing from time to time.
|
SNYDER’S-LANCE, INC.
|
By
|
Executive Vice President and Chief Financial Officer
|
Granted To
|
Award Date
|
Number of Units
|
Vesting Amounts and Dates
|
PARTICIPANT NAME
|
XX/XX/XXXX
|
NUMBER OF AWARDS GRANTED
|
(See Exhibit A)
|
Fair Market Value Per Unit:
|
|||
$$.$$
|
1.
|
Subject to the terms and conditions of the Incentive Plan and this Agreement, the Company awards to you the number of Performance Restricted Stock Units stated above (the "Units"). Each of the Units represents the right to receive one share of Common Stock, subject to the terms and conditions set forth in this Agreement and the Incentive Plan. The Units shall be credited to a separate account maintained for you on the books and records of the Company (the "Account"). All amounts credited to your Account in the form of Units shall continue for all purposes to be part of the general assets of the Company. By accepting this Agreement, you acknowledge having read the Prospectus and agree to be bound by all the terms and conditions of the Incentive Plan, this Agreement and the Snyder’s-Lance, Inc. 2017 Enterprise Incentive Plan (the “Plan”).
|
2.
|
The Units shall vest to you as specified in Exhibit A and in the event of a Change in Control as defined in the Plan. Vested Units shall be delivered to you in the form of shares of Common Stock as soon as practicable following the date of vesting, as specified in the Exhibit A and the Plan.
|
(a)
|
Regardless of any action the Company takes with respect to any or all income tax, payroll tax or other tax-related withholding (“Tax-Related Items”), you acknowledges that the ultimate liability for all Tax-Related Items owed by you is and remains your responsibility and that the Company (i) makes no representations or undertakings regarding the treatment of any Tax-Related Items in connection with any aspect of the Award, including the grant or vesting of the Award or the subsequent sale of shares; and (ii) does not commit to structure the terms of the grant or any aspect of the Award to reduce or eliminate your liability for Tax-Related Items.
|
(b)
|
Prior to the vesting of the Award, you shall pay or make adequate arrangements satisfactory to the Company to satisfy all minimum withholding obligations of the Company. In this regard, you authorize the Company to withhold all applicable minimum Tax-Related Items legally payable by you from your wages or other cash compensation paid to you by the Company or from proceeds of the sale of the shares you may acquire in connection with this Award. Alternatively, or in addition, to the extent permissible under applicable law, the Company may (i) sell or arrange for the sale of shares that you acquire to meet the minimum withholding obligation for Tax-Related Items, and/or (ii) withhold shares otherwise deliverable upon vesting, provided that the Company only withholds the amount of shares necessary to satisfy the minimum withholding amount (to the extent necessary to comply with applicable tax laws or generally applicable accounting principles). Finally, you shall pay to the Company any amount of Tax-Related Items that the Company may be required to withhold as a result of your participation in the Incentive Plan that cannot be satisfied by the means previously described. The Company may refuse to issue and deliver shares upon vesting if you fail to comply with your obligations in connection with the Tax-Related Items as described in this Section 2. While the Units are held by the Company and until such time as the Units are settled under this Agreement, you shall not have the right to sell, transfer, assign, pledge or otherwise dispose of the Units or any interest therein.
|
3.
|
You shall not have any rights of a shareholder with respect to the shares of Common Stock underlying the Units unless and until the Units vest and are settled by the issuance of such shares of Common Stock. Upon and following the settlement of the Units, you shall be the record owner of the shares of Common Stock underlying the Units unless and until such shares are sold or otherwise disposed of, and as record owner shall be entitled to all rights of a shareholder of the Company (including voting rights).
|
4.
|
Notwithstanding Section 3, in the event of a dividend distribution by the Company on or after the Award Date stated above but before the settlement of the Units, you shall be granted additional Performance Restricted Stock Units on the payment date of the dividend, as follow:
|
(a)
|
If additional Performance Restricted Stock Units are granted as a result of a stock dividend, the number of additional Performance Restricted Stock Units to be granted to you under this Section 4 shall be equal to the number of shares you would have received as a result of such stock dividend if one share of Common Stock had been issued for each Performance Restricted Stock Unit granted to you under this Agreement.
|
(b)
|
If additional Performance Restricted Stock Units are granted as a result of a cash dividend, the number of additional Performance Restricted Stock Units to be granted to you under this Section 4 shall be equal to the Dollar amount you would have received as a result of such cash dividend if one share of Common Stock had been issued for each Performance Restricted Stock Unit granted to you under this Agreement, divided by the closing price of the Common Stock on the payment date of the dividend, with the results rounded to the nearest whole share.
|
5.
|
The existence of this Award shall not affect in any way the right or power of the Company or its stockholders to make or authorize any or all adjustments, recapitalizations, reorganizations or other changes in the Company's capital structure or its business, or any merger or consolidation of the Company, or any issue of bonds, debentures, preferred or prior preference stocks ahead of or convertible into, or otherwise affecting the Common Stock or the rights thereof, or the dissolution or liquidation of the Company, or any sale or transfer of all or any part of its assets or business, or any other corporate act or proceeding, whether of a similar character or otherwise.
|
6.
|
Any notice which either party hereto may be required or permitted to give to the other shall be in writing and may be delivered personally, by intra-office mail, by email, by fax or by mail, postage prepaid, to such address and directed to such person(s) as the Company may notify you from time to time; and to you, at your address as shown on the records of the Company from time to time, or at such other address as you, by notice to the Company, may designate in writing from time to time.
|
SNYDER’S-LANCE, INC.
|
By
|
Executive Vice President and Chief Financial Officer
|
a.
|
Paragraph 1(c) of the ESA is hereby deleted in its entirety and replaced with the following:
|
b.
|
Paragraph 1(l) of the ESA is hereby delete in its entirety and replaced with the following:
|
FRANK B. SCHUSTER
/s/ Frank B. Schuster
Date: November 8, 2017
|
|
SNYDER’S-LANCE, INC.
/s/ Andrea Frohning
Name: Andrea Frohning
Title: SVP and Chief HR Officer
Date: November 8, 2017
|
Section of the ESA
|
Amount and/or description
|
Section 3(a)
|
Provided for in Section 2 of the Agreement.
|
Section 3(b)
|
Total payment of $527,600, payable in 12 monthly installments, commencing on or about the 30
th
day following the Termination Date.
|
Section 3(c)
|
•
2017 Annual Performance Incentive Plan for Officers and Key Managers, subject to actual performance and paid when paid to other plan participants and prorated for days employed (307 days out of 364)
•
2015, 2016 and 2017 LTIPs
◦
Stock Options - unvested are forfeited and cancelled as of the Termination Date
◦
Restricted Stock - unvested are forfeited and cancelled as of the Termination Date
◦
Performance Awards - you are eligible for a prorated portion (as provided for in Section 3(c) of the ESA) of this award, subject to satisfaction of performance goals and paid when active employees receive their awards
◦
Performance Restricted Stock Units - you are eligible for a prorated portion (as provided for in Section 3(c) of the ESA) of this award, subject to satisfaction of performance goals and paid when active employees receive their awards
◦
Timing of the awards for which you are eligible as referenced above:
▪
2015 awards, if any, are payable in 2018 when others are paid
▪
2016 awards, if any, are payable in 2019 when others are paid
|
Section 3(c)
|
▪
2017 awards, if any, are payable in 2020 when others are paid
•
2017 Enterprise Incentive Plan (EIP)
◦
Performance Stock Options - you are eligible for a prorated portion (as provided for in Section 3(c) of the ESA) of this award, subject to satisfaction of performance goals and paid when active employees receive their awards
◦
Performance Restricted Stock Units - you are eligible for a prorated portion (as provided for in Section 3(c) of the ESA) of this award, subject to satisfaction of performance goals and paid when active employees receive their awards
◦
Timing of the awards for which you are eligible as referenced above:
▪
50% of 2017 EIP Performance Stock Options and Performance Restricted Stock Units, if any, are payable in 2020 when others are paid
▪
50% of 2017 EIP Performance Stock Options and Performance Restricted Stock Units, if any, are payable in 2021 when others are paid
|
Section 3 (d)
|
Indemnification as provided for in the ESA.
|
Section 3 (e)
|
One year of outplacement assistance, not to exceed a value of $35,170, and as otherwise provided for in the ESA.
|
Section 3 (f)
|
No acceleration of any outstanding unvested equity awards.
Any options vested as of the Termination Date shall continue to be exercisable for a period of one year following the Termination Date (or the original expiration date of the option, if shorter).
TABLE 2 below reflects vesting and exercisability of Executive’s outstanding equity awards.
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Snyder’s-Lance, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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a)
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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c)
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Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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d)
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Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an Annual Report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
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a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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/s/ Brian J. Driscoll
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Brian J. Driscoll
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President and Chief Executive Officer
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1.
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I have reviewed this quarterly report on Form 10-Q of Snyder’s-Lance, Inc.;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an Annual Report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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/s/ Alexander W. Pease
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Alexander W. Pease
|
Executive Vice President, Chief Financial Officer
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(1)
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The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
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(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
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/s/ Brian J. Driscoll
|
|
|
|
/s/ Alexander W. Pease
|
Brian J. Driscoll
|
|
|
|
Alexander W. Pease
|
President and Chief Executive Officer
|
|
|
|
Executive Vice President, Chief Financial Officer
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November 9, 2017
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November 9, 2017
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