Seminis Inc., the world's largest developer, producer and
marketer of vegetable and fruit seeds, today reported financial
results for its first quarter ended December 31, 2004.
FINANCIAL SUMMARY ($ IN
MILLIONS)
1stQ FY2005 1stQ FY2004 % Change
----------------------------------------------------------------------
SALES $110.7 $101.9 8.6%
----------------------------------------------------------------------
GROSS PROFIT(a) $63.6 $49.4 28.8%
----------------------------------------------------------------------
LOSS FROM OPERATIONS(b) $(5.0) $(7.4) 32.7%
----------------------------------------------------------------------
NET LOSS(b) $(8.2) $(9.1) 10.7%
----------------------------------------------------------------------
(a) Negatively impacted by non-cash purchase accounting charges of
$10.0 million and $11.5 million in first quarter of FY2005 and
FY2004, respectively.
(b) Negatively impacted by $9.8 million and $9.8 million of merger
and privatization related charges, non-cash purchase accounting
charges and other add-back expenses as allowed in the debt
covenants in FY2005 and FY2004, respectively.
"During our most challenging
quarter seasonally, the company delivered top and bottom line
growth on par with our leadership position. From an operational
perspective, our gross profits are unmatched in our sector and
we continue to demonstrate success at efficiently introducing
innovative products to local markets throughout the world," said
Seminis Chairman and CEO Alfonso Romo.
Net sales for the first quarter
of fiscal year 2005 increased 8.6% to $110.7 million compared
with $101.9 million for the same period last year. This increase
was mainly attributable to improved pricing and product
availability as well as favorable Euro and Korean Won currency
fluctuation. At constant exchange rates, total sales increased
4.1% to $106.9 million from $101.9 million the previous year.
Gross profit increased to $63.6
million, or 57.5% of sales, compared with $49.4 million, or
48.5% of sales, for the same quarter last year. This increase
was primarily due to improved volume, margins and lower
provision requirements of certain reserves.
Total operating expenses for
the first quarter increased by 15.3% to $68.5 million from $59.4
million in the same period last year mainly as a result of cost
of living adjustments and the increase of Euro and Korean Won
based expenses due to currency fluctuation. As a percentage of
sales, operating expenses in the current quarter increased to
61.8% compared with 58.3% in the first quarter of fiscal year
2004.
Operating loss for the first
quarter was $5.0 million compared to a loss of $7.4 million for
the same quarter last year.
The net loss for the first
quarter of fiscal year 2005 was $8.2 million compared to a net
loss of $9.1 million in the same quarter last year.
Historically, the first quarter of Seminis' fiscal year has the
lowest sales due to the seasonal nature of the agronomic cycle,
and the company has posted losses during these periods.
The non-cash purchase
accounting impact of the amortization of inventory step-up
resulting from the privatization transaction to Cost of Goods
Sold was $10.0 million during the first quarter compared to
$11.5 million for the same quarter last year. The net benefit in
depreciation and amortization within Operating Expense as a
result of the purchase accounting treatment during the first
quarter totaled $3.2 million compared to $3.4 million during the
same period the previous year.
Seminis President and Chief
Operating Officer Bruno Ferrari noted: "I am pleased with our
strong start to fiscal year 2005. We are now in the midst of
spring plantings in the northern hemisphere and Seminis is well
positioned with seed of our top product lines. We continue to
benefit from continued growth in our industry and strong demand
for our seed varieties."
CONFERENCE CALL
Seminis will hold a conference
for interested parties on February 15, 2005 at 12 p.m. Eastern
Standard Time (11 a.m. Central Standard Time, 9 a.m. Pacific
Standard Time). The call will focus on first quarter results and
may also include other matters related to the company's
business. To participate, call toll-free 800-599-9816;
international dial-in 617-847-8705. Participant Pass-code:
67220707. Participants are requested to dial in 5 minutes prior
to the start of the call to allow time for all participants to
log in. A replay of the call will be available two hours after
the call for a period of seven days. The replay can be accessed
by dialing 888-286-8010; international dial-in 617-801-6888
Pass-code: 95828294. Seminis financial statements can be found
on our web-site at www.seminis.com or on the SEC web-site at
www.sec.gov.
Seminis Inc. is the largest
developer, producer and marketer of vegetable seeds in the
world. The company uses seeds as the delivery vehicle for
innovative agricultural technology. Its products are designed to
reduce the need for agricultural chemicals, increase crop yield,
reduce spoilage, offer longer shelf life, create better tasting
foods and foods with better nutritional content. Seminis has
established a worldwide presence and global distribution network
that spans 150 countries and territories.
SEMINIS, INC.
Consolidated Balance Sheets
(In thousands)
As of As of
December September
31, 30,
2004 2004
--------- -----------
ASSETS:
Current assets
Cash and cash equivalents $75,796 $116,870
Accounts receivable, net 149,679 153,173
Inventories 345,146 328,395
Prepaid expenses and other current assets 11,661 8,017
--------- -----------
Total current assets 582,282 606,455
Property, plant and equipment, net 86,963 78,608
Intangible assets, net 70,196 69,008
Other assets 24,097 23,591
--------- -----------
Total assets $763,538 $777,662
========= ===========
LIABILITIES AND STOCKHOLDERS' EQUITY:
------------------------------------------------
Current liabilities
Short-term borrowings $20,604 $10,965
Current maturities of long-term debt 1,826 1,746
Accounts payable 46,177 63,339
Accrued liabilities 110,427 120,334
--------- -----------
Total current liabilities 179,034 196,384
Long-term debt 448,064 448,816
Deferred income tax 20,804 16,291
Minority interest in subsidiaries 1,455 1,644
Preferred shares subject to mandatory redemption 42,016 41,773
--------- -----------
Total liabilities 691,373 704,908
--------- -----------
Stockholders' equity 72,165 72,754
--------- -----------
Total liabilities and stockholders' equity $763,538 $777,662
========= ===========
SEMINIS, INC.
Consolidated Statements of Operations
(In thousands, except per share data)
For the Three Months Ended
---------------------------
Dec. 31, Dec. 26, %
2004 2003 Change
--------- --------- -------
Net sales $110,704 $101,892 8.6%
Cost of goods sold 47,074 52,475 -10.3%
--------- --------- -------
Gross profit 63,630 49,417 28.8%
Research and development 13,022 11,574 12.5%
Selling, general and administrative
expenses 53,374 45,910 16.3%
Amortization of intangible assets 2,061 1,887 9.3%
--------- --------- -------
Total operating expenses 68,457 59,371 15.3%
--------- --------- -------
Gain (loss) on sale of fixed assets (173) 2,525 -106.9%
--------- --------- -------
Loss from operations (5,000) (7,429) -32.7%
Other income (expense)
Interest expense, net (11,828) (9,684) 22.1%
Other, net 10,373 9,067 14.4%
--------- --------- -------
Total non-operating expense (1,455) (617) 135.8%
--------- --------- -------
Loss from continuing operations before
income taxes (6,455) (8,046) -19.8%
Income tax expense (1,701) (1,083) 57.1%
--------- --------- -------
Net loss $(8,156) $(9,129) -10.7%
========= ========= =======
Seminis Inc.
Net Seed Sales
Amounts Stated at FY 2004 Currency Exchange Rates
(In US Million $)
Three Months Ended
December 31, 2004
-------------------------------
FY 2005 FY 2004 % Change
------------ -------- ---------
North America $45.3 $39.8 13.8%
Europe & Middle East 40.1 42.9 -6.5%
Asia Pacific 9.8 8.9 10.1%
West Asia 1.1 0.8 37.5%
South America 6.0 5.9 1.7%
------------ -------- ---------
Total Seed Sales $102.3 $98.3 4.1%
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